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WORKS MANAGEMENT LIBRARY 



WORK, WAGES, AND 
PROFITS 

SECOND EDITION 
REVISED AND ENLARGED 

BY 

H. L. GANTT 




NEW YORK 

THE ENGINEERING MAGAZINE CO. 

1913 



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Copyright, 1913, 
By THE ENGINEEEING MAGAZINE CO. 



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INTEODUCTION TO SECOND EDITION 

The first edition of Mr. Gantt's book appeared in 
1910 as a volume of 194 pages, with seven charts, 
the graphic illustrations and most of the specific 
examples being drawn from results secured in the 
textile industries. Since that date a rapid rise has 
taken place in public attention to the methods used 
and the results secured, and in the active effort (evi- 
denced by inquiry and undertaking) to obtain ad- 
vantages corresponding to those so substantially 
realized in the cases cited. 

This interest and inquiry have been the principal 
infiuence inspiring the enlargement of this book, not 
only by inclusion of additional instances, but by 
more detailed development of some features of the 
work, and the summation of the argument into a 
comprehensive and entire (even if broadly sketched) 
outline of a plan of systematic management, based 
on the policies and methods defined by Mr. Gantt. 
His experience in the field of labor management 
covers a quarter-century of close practical applica- 
tion. His special methods, which even yet are but 
partially and imperfectly understood by many, have 
been identified with his name for at least half this 
period. These methods are sometimes incorrectly 
supposed to be summed up in the bonus system of 
wage payment; but the inducement of increased 
earnings is only one factor, and almost the last fac- 
tor, in the complete statement of Mr. Gantt's meth- 

3 



4 INTRODUCTION TO SECOND EDITION 

ods. His whole concept of scientific investigation, 
careful standardization^ individual instruction, and 
interconnected reward to both instructor or super- 
visor and workman, must be clearly grasped before 
any adequate idea of task work with bonus can be 
obtained. 

This full concept is set forth in the present vol- 
ume, multiplied by ample exhibition of practical re- 
sults. The added material is drawn from the me- 
chanical industries, from machine-shop, metal-work- 
ing and locomotive-building plants. The colored 
charts, which have been received with so much in- 
terest, are increased in number from six to twelve, 
the whole number of illustrations being brought up 
to twenty-seven, and the original nine chapters being 
enlarged by expansion and supplement to twelve. 

The larger portion of the first edition was gath- 
ered by compilation of a series of articles published 
in The Engineering Magazine from February to 
June, 1910, with incorporation of three of Mr. 
Gantt's important earlier contributions on the same 
subject. To this are now added a new chapter on 
^^The Task Idea,^^ adapted from Mr. Gantt's paper 
before the Tuck School Conference; an enlargement 
of the discussion on "Fixing Habits of Industry,'^ 
based upon results observed since the former volume 
was issued; a new chapter on "Kesults," inspired by 
comment and inquiry addressed to the author dur- 
ing the last three years; and a concluding chapter, 
condensed from an article on "A Practical Example 
of Scientific Management," published in Tlie Engi- 
neering Magazine for April, 1911. 

It is natural, and indeed inevitable, in the present 
active development of the philosophy of efficiency 
and the practice of scientific management, that such 
revisions should be made. The underlying ideas are 



INTRODUCTION" TO SECOND EDITION 5 

vital; and, like all live things, they are still grow- 
ing, and will continue to grow. Growth means ex- 
pansion, if not change of form, and this makes final 
definition impossible, because definition means limi- 
tation. In the following pages, however, Mr. Gantt 
gives the fullest exposition ever put forth of his ma- 
ture thought and work. He gives to the world here 
the latest word (though happily far from the last 
word) on his principles and practice. His grasp 
of fundamentals is scientific. His association of ef- 
fects with their causes is philosophic. In its entirety 
the work offers an interpretation of industrial con- 
ditions and a promise for betterment that make it 
a classic — a classic of optimism — in the literature of 
industry. 

Charles Buxton Going. 



PEEFACE TO SECOND EDITION 

The law of development is evolution. Revolution 
is justified only when evolution is impossible. 

If the most complete system of scientific manage- 
ment which has ever been devised could be installed 
in a manufacturing plant over night, it would prob- 
ably be impossible to operate that plant at all the 
next day, and for weeks, perhaps months, it would 
be operated in such an inefficient manner as un- 
doubtedly to cause very serious losses. 

A system of management especially designed for 
economical production is a mechanism which is suc- 
cessful only when all parts work in harmony. The 
men who form a part of this mechanism must be 
trained individually and collectively. 

At the battle of Santiago, individually capable 
men, serving good guns, under high-class officers, 
made an average of three per cent in their hits, at 
an average distance of not over two miles. These 
same men, under the same officers, properly trained 
to use the best scientific knowledge and methods of 
today, would easily score in hits eighty per cent of 
the shots at the same range, at the same time firing 
five times as rapidly. 

To attempt to operate a new system of gun-fire 
control from rules and instructions, without train- 
ing the men, would result in the loss of even the 
three per cent efficiency which existed before the 
introduction of the new system. 

7 



8 PEEFACE TO SECOND EDITION 

While I do not believe that, in an ordinary manu- 
facturing establishment, a sudden change of manage- 
ment would be quite as disastrous as such a change 
would have been in the navy, yet it would unques- 
tionably be very detrimental to the business, per- 
haps for a long time. 

The principles of modern industrial organization, 
popularly known as "Scientific Management," are 
getting to be pretty well understood by those who 
have studied the subject thoroughly. Even the meth- 
ods of operating the various mechanisms used for 
this purpose are becoming more clear to people who 
are in the habit of investigating new methods and 
ideas. These methods, however, can never be util- 
ized properly until the rank and file have been trained 
to operate under them. This training necessarily 
takes time; but, if it is properly done, I have yet 
to find anybody more enthusiastic than the workmen 
themselves operating under it. They have the same 
kind of enthusiasm that the gunner in the navy has 
acquired since he learned that shooting is no longer 
guess-work. 

The man who undertakes to introduce scientific 
management and pins his faith to rules, and the use 
of forms and blanks,, without thoroughly compre- 
hending the principles upon which it is based, will 
fail. Forms and blanks are simply the means to an 
end. If the end is not kept clearly in mind, the use 
of these forms and blanks is apt to be detrimental 
rather than beneficial. 

This book is an effort to explain the principles of 
"Modern Industrial Organization,^' and to give some 
idea of how to utilize the methods of evolution in 
the introduction of a system of management based 
on these principles. 



PEEFx^CE TO SECOND EDITION y 

A system of management is an asset, and a good 
system is a valuable asset. 

The cost of acquiring such an asset cannot be 
legitimately charged to operating expenses. 

H. L. Gantt. 
April, 1913. 



CONTENTS 

Chapter I. The Application of the Scientific 
Method to the Labor Problem 

Economical Utilization of Labor the Great 
Modern Problem for Engineers and Managers — 
Limitation of Output by Workers — Limitation 
of Workmen's Allowable Earnings by Employ- 
ers — How These Tendencies Militate against the 
Common Good — Permanently Successful Man- 
agement Must Be Beneficial to both Employer 
and Employee — The Inefficiency of Ordinary 
Management Systems — ^The Inefficiency of Ordi- 
nary Labor — The Possible Betterment Obtaina- 
ble through Scientific Study — The Attainable 
Output Generally Three Times the Present 
Average — Realization of This Large Possible 
Productivity Depends on the Manager — His 
Guide Is Scientific Investigation — The Three 
Parts of the Problem Defined— The Benefits 
Secured. 19 

Chapter II. The Utilization of Labor 

The Commercial Axiom that Good Bargains 
Benefit both Parties — The Same Principle now 
Realized in Industrial Relations — Efficient 
Work Goes with High Wages — Inefficient Plant 
Design or Equipment Makes Efficient Labor 
Impossible — Common-Sense Methods in Improv- 
ing Plant Efficiency — Scientific Study Necessary 
to Determine the Efficiency of Operations — In- 
stances of Uneconomical Methods — The Ele- 
ments of Operation Study — How Operation 
Times are Standardized — How the Workman Is 
Induced to Reach Standard Times — The Four 

11 



12 CONTENTS 

Conditions Necessary to Secure Best Results — 
Exact Knowledge of the Best Way of Doing 
the Work — Instructing the Workmen how to 
Do It — Wages as an Inducement — Loss of 
Bonus as a Preventive of Failure — Manage- 
ment and Wages. 33 

Chapter III. The Compensation of Workmen 
The Passing of the Age of Force — The Con- 
flict between Employer and Employee — ^Trade 
Unions ; Why They Exist — Collective Bargain- 
ing the Inevitable Accompaniment of a Class 
Wage Rate — Its Disadvantage to the Employer 
— Its Disadvantage to the Progressive Work- 
man — Possibility of Offering the Individual 
Worker Something Better than the Union — 
Ordinary Methods of Wage Payment and Their 
Tendencies. 51 

Chapter IV. Day Work 

Day Work Defined — What Regulates Day 
Wages — The Class Wage Rate Destructive to 
the Efiiciency of Labor — Keeping Individnal 
Efficiency Records — The Difficulties and the Pos- 
sibilities — Practical Methods Outlined — The Re- 
sults Secured in Practice — The Suggestion of 
a System that can Supplant the Union 65 

Chapter V. Piece Work 

How It Differs from Day Work — How Ordi- 
nary Piece Work Involves the Same Evils as 
the Day Wage — Why Ordinary Piece Work Pro- 
duces Labor Troubles — Unreliability of Ordi- 
nary Time Records and Foremen's Estimates — 
How the Efficient Worker under the Ordinary 
Piece-Rate System Is Penalized — A New and 
Better System Proposed — Its Essentials — Ex- 
pert Investigation, Standard Methods, Capable 
Workers, Proper Instruction, Sufficient Com- 
pensation — Why the Ordinary Foreman can not 
Do the Work of the Expert — Ordinary Shop 
Difficulties in Introducing the System — How 
They may Be Overcome — ^Training of Work- 
men — Compensation of Workmen and of Train- 



CONTENTS 13 

ers — ^Keeping Good Faith with the Men — ^The 
Value of the Efficient Man to His Employer — 
A Modern Counterpart of the Apprentice Sys- 
tem 77 

Chaptee VI. Task Work with a Bonus 

A Review of the Wage Conditions That Lead 
to Labor Unions and Labor Conflicts — A Survey 
of What Has Been Accomplished in Reward- 
ing Efficiency and Promoting Labor Peace — 
The History of the Bonus System — Its Early 
Results — How It Succeeded at the Bethlehem 
Steel Works — How Its Abandonment There 
Brought Back Labor Troubles — A Recapitula- 
tion of the Elements of the Successful System. 103 

Chapter VII. The Task Idea 

Fundamental Principle Underlying Task 
Work with a Bonus — Its Essential Difference 
from the "Drive" Method — The Task Idea Sug- 
gested by Proved Experience in Training Chil- 
dren — The Inspiration of Working for an Ob- 
ject — Task and Bonus in Accord with Human 
Nature — Task and Bonus Therefore a Proper 
Foundation for Successful Management — The 
Problem Is to Set the Proper Task — Obstacles 
Discovered in Practical Experience — Schedules 
as Tasks — Scheduling Miscellaneous Work — In- 
dividual Efficiency Rapidly Raised by Simple 
Schedules — Practical Introduction of the Sched- 
uling System — Preparation for Task Setting — 
What Steps It Is Necessary to Take — ^How Hard 
the Task Should Be — ^Performing the Tasks — 
Obligations of the Management — ^Task Work in 
a Machine Shop — Actual Experience in a Bleach- 
ery — Planning and Task Setting Often Increase 
Output Threefold — ^Maintaining Proper Condi- 
tions 121 

Chapter VIII. Training Workmen in Habits of 
Industry and Co-operation 

Habits of Industry More Valuable than Knowl- 
edge or Skill— How These Habits Are Culti- 
vated by the Bonus System — Its Practical Ap- 
plications Explained in Detail — How Habits of 
Work Are Practically Cultivated— How Quality 



14' CONTENTS 

as Well as Quantity of Output Improves— The 
Setting of Tasks — The Standardization of Work 
— Obstacles to the Introduction of the System — 
Helps to Its Stability after It Has Been Intro- 
duced — The Co-operation of the Men Secured 
— The Reasons Why Work Is Better as Well as 
Larger — Method of Introducing the System into 
a New Plant 147 

Chapter IX. Fixing Habits of Industry 

Records of Specific Cases Since 1905 — ^The 
Task and Bonus System in a Cotton Mill — Indi- 
vidual Records of the Weavers Exhibited on a 
Colored Chart — The Chart Explained and Dis- 
cussed — Experience in a Weave Shed Exhibiting 
Great Success — Colored Chart Showing the 
Bonus System Applied to Winding Bobbins — 
Discussion — Colored Chart Showing Conditions 
in the Same Department Three Years Later — 
Colored Chart Showing Task and Bonus System 
Applied to Spoolers — Progress of Efficiency 
Pointed Out — Chart Showing Task and Bonus 
System with Inspectors — Chart Showing Actual 
Results on Wages, Output, and Unit Costs in 
Folding-Room — How the Results Were Main- 
tained for Three Years Continuously — Colored 
Chart Showing Results in a Worsted Mill — Col- 
ored Chart Showing Increase in Efficiency of 
Weavers — Colored Chart Showing Maintenance 
of Result for Several Years — How the Spirit 
of Co-operation Is Established 175 

Chapter X. Results 

Diagram Showing Comparison Between Old 
Conditions and New — Improvement in Ratios of 
Output, Wage Costs, and Wage Rate — Better- 
ment of Quality as Well as Quantity of Output 
— Reorganization Effected in a Packing-Box Fac- 
tory — Chart Showing Results Secured with 
Automatic Screw Machines — Chart Showing 
Betterment in Miscellaneous Machine Work — 
Similarity of Effects in All Cases— Effect on 
Reduction of Overhead Expense — Treatment of 
Mistakes in Task Setting — Universality of the 
Principles Proved by Charts — The Essentials of 
the Methods Employed — Favorable Physical and 
Mental Effects Observed Among Bonus Workers 207 



CON'TENTS 15 

Chapter XI. Prices and Profits 

The Trust Movement of 1890— Effects of Con- 
solidation on Economy of Operation — Effects of 
Union Labor on Increase of Production Cost — 
Two Ways of Increasing Profits: Increasing 
Selling Price or Decreasing Production Cost — 
The Vicious Cycle of Increased Prices — Horizon- 
tal Rise of Wages Not a Cure but a Transient 
Expedient — ^Necessity of Adjusting Prices to 
Value — The Economic Law That Permanent 
Large Profits Can Be Secured Only by Efficient 
Operation — American Reliance on Huge Na- 
tional Resources Most Unsafe — Increased Ef- 
ficiency a Question of National Importance — 
Scientific Methods Must Be Applied to Manufac- 
turing Problems — Difficulties Inherent in the 
Factory System — How Task and Bonus Restores 
the Advantages of the Older Order — The Ele- 
ments of Manufacturing Cost — Profits Can Be 
Greatly Enlarged Only by Increasing Efficiency 
of Operation — The System of Management Ad- 
vocated Insures Efficient Control — The Cost Is 
Small 227 

Chapter XII. A Practical Example 

Origin of the Task and Bonus System— Ele- 
ments of the System — ^The Limitation of Bonus 
— Making Out Instruction Cards — How Task 
Times and Work Methods Are Determined — Ad- 
vantages of Bonus over Piece Rates — Application 
of Instruction Cards to a Machine Shop — Illus- 
trations of Typical Cards — The Man Record — 
Daily Balance of Work — A Foundry Schedule 
and Balance — Illustration of Balance Sheet — 
The Daily Balance as a Permanent Record — A 
Machine-Shop Balance and Schedule — Illustra- 
tion — ^Value of Balance Not Dependent upon 
Method of Compensation — Cost of Keeping Bal- 
ances — Illustrations of Time Cards — Time Rec- 
ords — Cost Determinations — Cost of Time-Keep- 
ing System — Determining Progress of Produc- 
tion — Difficulties of Getting a Daily Balance — 
Values of the Balance when Obtained — ^The 
Schedule System — Routine and Expert Work — 
General Principles and Details 253 



TABLE OF ILLUSTRATIONS 

Man Record Sheet 68 

Weavers' Achievement of Task 182 

Fixation of Habits of Industry 182 

Disappearance of the Slack Monday Habit 186 

Maintenance of Conditions for Three Years 189 

Disappearance of Slack Saturday Habit 190 

Betterment of Output by Bonus to Foremen 190 

Twelve Months' Improvement under Task and Bonus 

System, Girls Working in a Folding Room 192 

Bonus Record of Girls in a Worsted Mill 194 

Same Room Later, Showing Progress of Betterment 194 
Results of Too Great Haste in Putting Workers on 

Bonus 196 

Errors of Hasty Start Corrected by Perseverance 200 

Very Recent Record Showing Success of Task and 

Bonus in Spite of Hostility of Workers 204 

Improvement of Ratios of Production, Wage-Cost, 

and Earnings by Task and Bonus Methods in 

Pillow-Case Factory 208 

Improvement of Output, Wage Earnings, and Pro- 
duction Cost of Small Automatic Machines 213 

Improvement of Output, Wage Earnings, and Pro- 
duction Cost of Large Automatic Machines 214 

Improvement of Output, Wage Earnings, and Pro- 
duction Cost in Miscellaneous Machine Work 217 

Instruction Card for Turning a Crank Shaft 264 

Instruction Card, Planing Locomotive Frames 265 

Instruction Card, Drilling Cylinder Cover, (Front). 267 
Instruction Card, Drilling Cylinder Cover, (Back)__ 267 

Graphical Balance for Foundry Records 273 

Graphical Record, Building 15 Locomotives 276 

Graphical Record, Showing Effect of Deficient 

Frame-Drilling Capacity 277 

Time Card for a Machine Shop 282 

Time Card Used in a Bleachery 283 

Rack for Time Cards 284 

16 



THE APPLICATION OF SCIENTIFIC 

METHODS TO THE LABOR 

PEOBLEM 



WORK, WAGES, AND PROFITS 



Chapter I 

THE APPLICATIOj^ OF SCIEISTTIFIC METH- 
ODS TO THE LABOE PROBLEM 

' I ^HE greatest problem before engineers 
-*- and managers today is the economical 
utilization of labor. The limiting of output 
by the workman, and the limiting by the em- 
ployer of the amount a workman is allowed 
to earn, are both factors which militate 
against that harmonious co-operation of em- 
ployer and employee which is essential to 
their highest common good. 

Scientific investigation is rapidly putting 
at our disposal vast amounts of knowledge 
concerning materials and forces, which it is 
the business of the engineer to utilize for the 
benefit of the community. Well-designed 
plants and efficient labor-saving devices, to 
be seen on every hand, bear testimony that 

19 



30 woek:, wages, and peofits 

lie is doing at least a portion of Ms work 
well. When, however, it comes to the opera- 
tion of these plants and the utilization of 
these labor-saving devices, the lack of co- 
operation between employer and employee, 
and the inefficient utilization of labor, very 
much impair their efficiency. 

The increase of this efficiency is essen- 
tially the problem of the manager, and the 
amount to which it can be increased by 
proper study is, in most cases, so great as to 
be almost incredible. 

In considering the subject of management 
we must recognize the fact that in this coun- 
try, so long as a man conforms to the laws 
of the State, he has a right to govern his 
own conduct, and to act in such a manner as 
his interests seem to dictate. Granting this, 
it follows that any scheme of management to 
be permanently successful must be beneficial 
alike to employer and employee, and neither 
labor unions that regard their interests as 
essentially antagonistic to that of employers, 
nor employers' associations whose only ef- 
fort is to oppose force with force, can ever 
effect a permanent solution of the problem 
of the proper relations between employers 
and employees. 



SCIENTIFIC METHODS FOR THE LABOR PROBLEM 21 

Boards of arbitration are temporary ex- 
pedients, and the results of their work are 
seldom better than a sort of Missouri com- 
promise, to be fought out later ; for although 
they be composed of men of the highest in- 
telligence, and of the greatest integrity, the 
conditions under which they are organized 
and the means at their disposal never enable 
them to get more than a superficial knowl- 
edge of the subject. The information such 
a board gets is all in the form of testimony, 
which, although it may be honestly given, can 
never produce a complete understanding of 
the subject; for, as a rule, neither employer 
nor employee knows exactly in detail the best 
way of doing a piece of work, and, as far as 
my own experience goes, they never Jcnoiv ex- 
actly lioiu long it should take a good man 
fitted for the work, and provided ivith proper 
implements. Before intelligent action can be 
taken in any case these facts must be known. 

In order to get a general idea of the con- 
ditions that exist in the mass of our manu- 
facturing industries it is necessary to review 
briefly the manner of their development. 

The expert mechanic, who, with a business 
growing to larger proportions than he could 
take care of, hired a few men to help him, 



22 WORK, WAGES, AND PROFITS 

and directed tliem all by his personal ex- 
ample and skill, first gave place to tlie small 
factory, wliich lie could run on tlie same lines. 

Today, however, even tlie smaller fac- 
tories have grown beyond the point where 
they can be directed or controlled by one 
man, and methods which were successful on 
the smaller scale fail now to apply on the 
larger. The factory is divided into depart- 
ments, each directed by a foreman, who, in 
many cases, has had no training in manage- 
ment, and often has no capacity for it. He 
is invariably overworked if he attempts to 
do his duty, and the manager seldom has 
time to inquire into his troubles, but fre- 
quently tries to remedy matters by appoint- 
ing another foreman, often making matters 
worse. 

Again, if expenses are too great, and it 
seems impossible to meet competition, there 
is seldom any serious effort made to find out 
why expenses are too high, but it is assumed 
that the way out of the difficulty is to reduce 
wages. It never appears to occur to a man- 
ager that perhaps the cause of the excessive 
expense may not lie with the workman, but 
with the management. Managers rarely seem 
to suspect that, if the workmen were more 



SCIENTIFIC METHODS FOR THE LABOR PROBLEM 23 

intelligently directed, tlie output per man 
might be largely increased without a corre- 
sponding increase in expense. 

Those who have given even superficial 
study to the subject are beginning to realize 
the enormous gain that can be made in the 
efficiency of workmen, if they are properly 
directed and provided with proper appli- 
ances. Few, however, have realized another 
fact of equal importance, namely, that to 
maintain permanently this increase of effi- 
ciency, the workman must be allowed a por- 
tion of the benefit derived from it. 

To obtain this high degree of efficiency 
successfully, however, the same careful scien- 
tific analysis and investigation must be ap- 
plied to every labor detail as the chemist or 
biologist applies to his work. Wherever this 
has been done, it has been found possible to 
reduce expenses, and, at the same time, to 
increase wages, producing a condition satis- 
factory to both employer and employee. 

The great difficulty in instituting this 
method of dealing with labor questions is 
that usually neither employer nor employee 
has sufficient knowledge of the scientific 
method to realize either the amount of detail 
work necessary, or the extent of the benefits 



24' WORK, WAGES, AND PROFITS 

to be derived from it. In general, their in- 
clination is to adhere to the methods with 
which they are familiar, and to distrust all 
others, even though their methods have failed 
to bring them appreciably nearer the solu- 
tion of their problems, and the newer 
methods have produced results far more sat- 
isfactory than they even hoped for. A scien- 
tific investigation into the details of a condi- 
tion that has grown up unassisted by science 
has never yet failed to show that economies 
and improvements are feasible that benefit 
both parties to an extent unsuspected by 
either. 

The scientific laboratory for the study of 
materials and forces, originally considered 
as belonging only to educational institutions, 
has recently become a recognized necessity 
in all our large industries, and to it princi- 
pally the great advance of recent years has 
been due. As yet, however, in but few cases 
has any definite attempt been made to study 
in a scientific manner the most efficient way 
of utilizing the human labor. Of how much 
work of various kinds the ordinary man has 
done, we have many records; but of how 
much a man specially suited to any class of 
work can do, we have almost no knowledge. 



SCIENTIFIC METHODS FOR THE LABOR PKUBLEM 25 

Enougli study has been spent on the subject, 
however, to determine that men specially- 
suited to any particular kind of labor, if sup- 
plied with proper implements and intelli- 
gently directed, can do on the average at 
least three times as much as the average 
workman does, if the limiting factor is physi- 
cal exertion; and, if assured sufficient com- 
pensation, the average workman will do this 
increased task, day after da}^ 

The ratio of what can be done to what is 
done is even greater than three to one in 
work requiring skill and planning. Well 
thought out plans alone, if accompanied by 
complete instructions for doing work, often 
produce an increase of more than 100 per 
cent, over what is usually done. This is par- 
ticularly true in complicated work, which 
should be planned most carefully, but which 
is often not planned at all. It is usually left 
to the judgment of a busy foreman, whose 
first knowledge of what is to be done reaches 
him with the order to do it. In such a case, 
it is the exception when the work does not 
cost in wages several times what it should, 
and this with no fault of the foreman or 
workman. 

These facts have been established in num- 



26 WORK, WAGES, AND PROFITS 

erous cases of ordinary labor, in doing ma- 
cHne-shop work, in building engines, and in 
the erection of strnctnres of various kinds. 
Similar possibilities have been indicated 
wlierever the slightest effort has been made 
to study or to plan, showing that in many in- 
stances a condition of affairs exists which is 
not only wasteful to the owners, but discour- 
aging and unjust to the workmen, most of 
whom would be willing to do more work to 
earn increased pay if only the opportunity 
to do so were offered, and they were guaran- 
teed that they would not ultimately lose by 
doing so. 

Mr. E. F. Du Brul, formerly the Commis- 
sioner of the National Metal Trades Asso- 
ciation, an organization of employers formed 
to protect themselves from the unjust de- 
mands of the labor unions, stated some time 
ago that a large majority of strikes were 
produced by mismanagement. Mr. Du Brul 
has perhaps had more general experience 
with striking employees than any other man 
in this country, and his conclusion is that the 
best insurance against strikes is good man- 
agement. He, therefore, strongly advises 
managers to study the subject. The neces- 
sity for this advice will become evident when 



SCIENTIFIC METHODS FOR THE LABOR PROBLEM 27 

we realize that hardly any two managers, un- 
less they have been trained under the same 
influence, agree as to the proper way of deal- 
ing with any of the intricate questions that 
are constantly arising between employer and 
employee; much less will they agree on any 
general principles of management. 

There have been in the past and are today 
great managers. Are there not some general 
principles by which they either consciously 
or unconsciously are governed! In other 
words, are there not some general principles, 
applicable, at least to a large number of 
cases, according to which substantial equity 
can be insured between employer and em- 
ployee, and a higher degree of efficiency re- 
alized from their harmonious co-operation? 

The only successful method of determin- 
ing general laws has been that of scientific 
investigation, and, in the study of questions 
involving human labor, enough has been done 
to show that the same method is applicable 
to at least a large number of individual cases, 
and there is good reason to believe that it is 
universally applicable. 

Labor unions demanding all they can get, 
and employers' associations organized sim- 
ply to oppose the demands of the unions, can 



28 work:, wages, and profits 

never evolve a satisfactory system of manage- 
ment ; for, altliougli each, in its way, may be 
(and undoubtedly is) often beneficial to its 
members, both are formed with the idea of 
using force only, which can never be a substi- 
tute for knowledge. 

Although a board of arbitration may be 
useful in averting a crisis, the decision of 
such a board founded on such facts as are 
available should be professedly only tempo- 
rary in character, to be revised later accord- 
ing to the results of a scientific investigation 
of the matter in dispute, to be undertaken 
at the earliest possible date. 

This problem consists of three parts : 

First. — To find out the proper day's task 
for a man suited to the work. 

Second. — To find out the compensation 
needed to induce such men to do a full day's 
work. 

Third. — To plan so that the workman may 
work continuously and efficiently. 

The problem is difficult, for a man suited 
to the work must be found and induced to 
work at his full capacity. The details of the 
work must be arranged so that he can work 
most efficiently, and the time to do each de- 
tail must be carefully studied with a stop 



SCIENTIFIC METHODS EOR THE LABOR PROBLEM 29 

watch. From such detail observations it is 
possible to deterniine what a good man can 
do, day after day, and there is but little diffi- 
culty in finding out what men have to be paid 
to make them do all they can; for, although 
men prefer, as a rule, to sell their time, and 
themselves determine the amount of work 
they will do in that time, a large proportion 
of them are willing to do any reasonable 
amount of work the employer may specify in 
that time, provided only they are shown how' 
it can be done, trained to do it, and guaran- 
teed substantial additional amounts of money 
for doing it. The additional amount needed 
to make men do as much as they can depends 
upon how hard or disagreeable the work is, 
and varies from 20 to 100 per cent, of what 
they can earn when working by the day, ac- 
cording to their own methods and at their 
preferred speed. 

The cost of these initial investigations is 
necessarily large, for they can be made only 
by capable men who have had the special 
training necessary, and hence the expense 
must be borne by the employer; but the re- 
turns, when the results of these investiga- 
tions begin to be applied, are so great as to 
pay; in a short time for the investigations, to 



30 WOEK, WAGES;, AXD PROFITS 

allow a substantial increase of wages to the 
employee, and to leave a good margin of 
profit to the employer. 

The benefits which have been derived from 
such investigations are: 

An increase of output. 

A decrease in cost of product. 

Better workmen attracted by higher 
wages. 

Improvement of quality of product due to 
better workmen and more careful super- 
vision. 

These results are well worth striving for, 
and the fact that they have been obtained by 
the application of the scientific method to 
the ordinary problems indicates strongly 
that progress is to be made in such matters 
by the scientific method, which has been re- 
sponsible for other kinds of progress in the 
past. 



EFFICIENT UTILIZATION OF LABOR 



Chapter II 

EFFICIENT UTILIZATIO]!^ OF LABOE 

T T has become an axiom in the commercial 
-■- world that in the long run those transac- 
tions most promote prosperity which are ad- 
vantageous alike to buyer and seller. It is 
coming to be realized in the industrial world 
that the same thing is true regarding the ar- 
rangements between employers and em- 
ployees, and that no arrangement is perma- 
nent that is not regarded by both as being 
beneficial. In other words, the only healthy 
industrial condition is that in which the em- 
ployer has the best men obtainable for his 
work, and the workman feels that his labor 
is being sold at the highest market price. 

The employer who insists on more service 
than he pays for, and the employee who de- 
mands excessive wages for his work, both 
lose in the long run. The former worries 
continually about how to manage dissatis- 
fied workmen, who are continually on the 
verge of a strike, and in dull times the lat- 
ter lives in constant dread that his employer 

33 



34 WORK, WAGES, AND PROFITS 

may no longer be able to continue business, 
and he may be out of work. In other words, 
unless efficient work goes with high wages, 
the result is apt to be disastrous to both em- 
ployer and employee, and if we would have 
satisfactory workmen we 'must learn how 
to make their labor efficient, for it is to effi- 
cient labor only that high wages can be uni- 
formly paid. 

Again, if a plant is badly laid out, if it 
contains inferior or antiquated machinery, 
or if the management- is inefficient, it may be 
impossible for the best workman to do an 
amount of work really entitling him to good 
wages. Any one of these causes and others 
may explain why a plant, whose name for 
years has been a synon5^m for prosperity, 
has gradually become less prosperous, until 
finally it scarcely holds its own by decreas- 
ing the wages of its employees. The final 
stage of such a plant is to close down in- 
definitely, and to remain for years a monu- 
ment to the short-sighted policy of its own- 
ers and the misfortune of its employees. 

The time to make provision against such 
a fate is not when sharp competition begins 
to show the need of it, but when prosperous 
times produce a large surplus of earnings. 



I 



EFFICIENT UTILIZATION OF LABOR 35 

Out of such earnings ample provision should 
be made to take full advantage of all im- 
provements in apparatus or management 
that are available. 

Improving a plant does not necessarily 
mean enlarging it, but equipping it with the 
best and most efficient apparatus scientific 
investigation can suggest and ingenuity can 
devise. 

Improving the system of management 
means the elimination of elements of chance 
or accident, and the accomplishment of all 
the ends desired in accordance with knowl- 
edge derived from a scientific investigation 
of everything down to the smallest detail of 
labor, for all misdirected effort is simply 
loss, and must he home either hy the em- 
ployer or employee. 

In a proper system of management prac- 
tically all loss of this character is eliminated, 
and the saving effected by this alone will 
usually pay all the expenses of the system 
and leave a handsome profit. 

Wherever any attempt is made to do work 
economically the compensation of the work- 
man is based more or less accurately on the 
efficiency of his labor. Very fair success in 
doing this has been accomplished in day 



36 WORK, WAGES, AND PROFITS 

work by keeping an exact record of the work 
done each day by every man, and by fixing 
his compensation accordingly. This method, 
however, falls very far short of securing the 
highest efficiency, for very few workmen 
know the best way of doing a piece of work, 
and almost none have the time or ability to 
investigate different methods and select the 
best. It often happens then that a man work- 
ing as hard as he can falls far short of what 
can be done on account of employing in- 
ferior methods, inferior tools, or both. 

We can never be certain that we have de- 
vised the best and most efficient method of 
doing any piece of work until we have sub- 
jected our methods to the criticism of a com- 
plete scientific investigation. Many people 
who have been accustomed to seeing an oper- 
ation performed in a certain way, or to per- 
forming it in that way for a number of years, 
imagine they know all about it, and resent 
the intimation that there may be some better 
way of doing it. Anybody, however, who 
carefully analyzes the sources of his 
methods will find that the mass of them are 
either inherited, so to speak, from his prede- 
cessor, or copied from his contemporaries. 
He will find that he knows but little of their 



EFFICIENT UTILIZATION OF LABOR 37 

real origin, and consequently has no ground 
on whicli to base an opinion of their effi- 
ciency. 

Even such a simple operation as shoveling 
is done very nneconomically in many places. 
I have seen the same shovel used for coal, 
ashes, and shavings, and this when coke forks 
were available for the shavings. The fore- 
man had apparently given the subject no 
study, and was content if the men were at 
work. The idea of working efficiently had 
never occurred to him. This is, of course, 
an extreme case, but it is a real one, and all 
degrees of efficiency exist between this and 
the case where each workman is provided 
with the proper implement and given a spe- 
cific task, for the accomplishment of which 
he is awarded extra compensation. 

The knowledge needed to set a task, even 
in such a simple case as shoveling, is much 
greater than is at first realized, for hardly 
any two substances can be treated exactly 
alike, and the same substance is often much 
harder to shovel from the top of a pile than 
from the bottom, which rests on a smooth, 
hard surface. In studying shoveling the first 
thing to be determined is the size of shovel, 
which must be gauged to hold the weight 



38 WORK, WAGES, AND PROFITS 

which it is most economical to handle. The 
second step is to find how long it takes to fill 
the shovel. For sand, fine coal, ashes, etc., 
it makes no difference in loading the shovel 
whether the material is taken from the top 
or the bottom of the pile; bnt in egg coal, 
broken stone, or lump ore, the difference is 
very great ; for, while it is quite easy to get 
a full shovel from the bottom of the pile 
which rests on a smooth, hard surface, it is, 
in some such cases, practically impossible to 
fill a shovel from the top of the pile without 
actually raking the material onto the shovel. 
Again, the distance or height to which the 
material is thrown is a factor in all cases, 
not only because the higher or longer throw 
takes slightly more time, but because it takes 
more energy. 

This analysis shows that each such opera- 
tion is composed of a number of elements, 
which may be studied separately. Having 
determined each element, they may be com- 
bined in a number of ways to show the time 
needed to fill and empty a shovel, with any 
material, under a variety of conditions. 
Knowing the time needed for an operation, 
we can add to it the percentage of time 
needed for rest, etc., which has been deter- 



EFFICIENT UTILIZATION OF LABOR 39 

mined by a long series of tests, and calculate 
just how many shovelfulls a good man can 
average per minute without over-exerting 
himself. Having determined thus the amount 
of work that a man can do, we can usually 
get it done if we offer the proper wages for 
doing it, and furnish an instructor who will 
teach the workman how to do it. 

Having determined the best method and 
taught it to a capable workman, to whom 
good wages are paid for its successful opera- 
tion, would seem to be enough to assure that 
the work should be done that way perma- 
nently. Such, however, is not the fact, for 
while these conditions will usually produce 
the desired result, they will not always main- 
tain it, but must be supplemented by another 
condition, namely, no increase in wages over 
day rate on the part of the workman unless 
a certain degree of efficiency is maintained. 

The importance of maintaining a definite 
degree of efficiency is readily understood 
when we consider that a properly equipped 
plant has only its proper complement of each 
kind of machine, and if the output of any 
one falls below a certain amount the output 
of the whole plant is diminished in propor- 
tion and the profits fall otf in a much greater 



40 WORK^ WAGES^ AND PROFITS 

ratio. This fact does not appeal to the work- 
man who has made good wages for several 
days and concludes to tahe it easy for a while, 
unless he also feels the loss his easy going 
causes his employer. 

In order to get the best results these four 
conditions are necessary: 

First — Complete and exact knowledge of 
the best way of doing the work, proper ap- 
pliances and materials. This is obtainable 
only as the result of a complete scientific 
investigation of the problem. 

Second — An instructor competent and will- 
ing to teach the workman how to make use 
of this information. 

Third — Wages for efficient work high 
enough to make a competent man feel that 
they are worth striving for. 

Fourth — No increase of wages over day 
rate unless a certain degree of efficiency is 
maintained. 

When these four conditions for efficient 
work are appreciated their truth seems al- 
most axiomatic. They are worthy of a very 
careful consideration. 

SCIENTIFIC INVESTIGATION. 

The first condition is an investigation of 
how to do the work and how long it should 



EFFICIENT UTILIZATION OF LABOR 41 

take. The fact tliat any operation, no 
matter how complicated, can be resolved 
into a series of simple operations, is 
the key to the solution of many prob- 
lems. Study leads us to the conclusion that 
complicated operations are always composed 
of a number of simple operations, and that 
the number of elementary operations is often 
smaller than the number of complicated op- 
erations of which they form the parts. The 
natural method, then, of studying a complex 
operation is to study its component element- 
ary operations. Such an investigation di- 
vides itself into three parts, as follows : An 
analysis of the operation into its elements; 
a study of these elements separately; a syn- 
thesis, or putting together the results of our 
study. 

This is recognized at once as simply the 
ordinary scientific method of procedure when 
it is desired to make any kind of an investi- 
gation, and it is well known that until this 
method was adopted science made practical- 
ly no progress. The ordinary man, whether 
mechanic or laborer, if left to himself seldom 
performs any operation in the manner most 
economical either of time or labor, and it has 
been conclusively loroven that even on ordi- 



42 WORK, WAGES, A^^D PROFITS 

nary day work a decided advantage can be 
gained hj giving men instrnctions as to how 
to perform the work they are set to do. It 
is perfectly well known that nearly every 
operation can be, and in actual work is, per- 
formed in a number of different ways, and 
it is self-evident that all of these wa^^s are 
not equally efficient. As a rule, some of the 
methods employed are so obviously inefficient 
that they may be discarded at once, but it is 
often a problem of considerable difficulty to 
find out the very best method. 

To analyze every job and make out instruc- 
tions as to how to perform each of the ele- 
mentary operations requires a great deal of 
knowledge, much of which is very difficult to 
acquire, but the results obtained by this 
method are so great that the expenditure to 
acquire the knowledge is comparatively in- 
significant. 

INSTKUCTIO:!TS. 

As a result of our scientific investigation, 
we find in general that it is possible to do 
about three times as much as is being done; 
the next problem is how to get it done. No 
matter how thoroughly convinced we may be 
of the proper method of doing a piece of work 



EFFICIEN"T UTILIZATION" OF LABOR 43 

and of the time it slionld take, we cannot 
make a man do it unless lie is convinced tliat 
in the long run it will be to his advantage. 
In other words, we must go about the work 
in such a manner that the workman will feel 
that the compensation offered will be perma- 
nent. 

When we have established this condition 
of affairs, we are ready to start a workman 
on the task, which, when properly set accord- 
ing to our investigation, can be done only by 
a skilled workman working at his best normal 
speed. The average workman will seldom 
be able, at first, to do more than two-thirds 
of the task, and, as a rule, not more than one 
out of five will be able to perform the task 
at first. By constant effort, however, the 
best workmen soon become efficient, and 
even the slower ones often learn to perform 
tasks which for months seemed entirely be- 
yond them. If our people have confidence 
in us and are willing to do as we ask, the 
problem of getting our task work started is 
easy. This, however, is frequently not the 
ease, and a long course of training is neces- 
sary before we can teach even one workman 
to perform his task regularly, for workmen 
are very reluctant to go through a course of 



'4:4: WORK^ WAGES, AMD PROFITS 

training to get a reward, especially when 
they fear that the high price will be cut when 
they can earn it easily. 

BUYIIsrG LABOE. 

Buying labor is one of the most important 
operations in modern manufacturing, yet it 
is one that is given the least amount of study. 
Most shops have expert financiers, expert 
designers, expert salesmen, and expert pur- 
chasing agents for everything except labor. 
The buying of labor is usually left to people 
whose special work is something else, with 
the result that it is usually done in a manner 
that is very unsatisfactory to buyer and 
seller. It is admitted to be the hardest prob- 
lem we have to face in manufacturing to-day, 
and yet it is only considered when the man- 
ager ^'has time,'^ or has ^4o take time,'' on 
account of ^^abor trouble.'' The time to 
study this subject is not when labor trouble 
is brewing, but when employer and employee 
have confidence in each other. 

Men, as a whole (not mechanics only), pre- 
fer to sell their time rather than their labor, 
and to perform in that time the amount of 
labor they consider proper for the pay re- 
ceived. In other words, they prefer to work 



EFFICIEN'T UTILIZATIOlSr OF LABOR '45 

by the day and be themselves tlie judges of 
the amount of work they shall do in that day, 
thus fixing absolutely the price of labor with- 
out regard to the wishes of the employer who 
pays the bill. While men prefer as a rule to 
sell their time, and themselves determine the 
amount of work they will do in that time, a 
very large number of them are willing to do 
any reasonable amount of work the employ- 
er may specify in that time, provided only 
they are shown how it can be done, and paid 
substantial additional amounts of money for 
doing it. The additional amount needed to 
make men do as much work as they can de- 
pends upon how hard or disagreeable the 
work is and varies (as previously stated) 
from 20 to 100 per cent, of their day rate. 

If the work is light and the workman is 
not physically tired at the end of the day he 
will follow instructions and do all the work 
called for if he can earn from 20 to 30 per 
cent, in addition to his usual day's wages. 
If the work is severe and he is physically 
tired at the end of the day he requires from 
4.0 to 60 per cent, additional to make him do 
his work. If in addition to being physically 
tired he has been obliged to work under dis- 
agreeable conditions or in intense heat, he 



46 WOEK^ WAGES^ AXD PEOFITS 

may require 70 per cent, or even 100 per cent, 
additional. These facts are derived from ex- 
perience and give ns a key to the intelligent 
purchase of labor. If we wish to buy the 
amount of labor needed to accomplish a cer- 
tain task, we must find out exactly, and in 
detail, the best method of doing the work, 
and then how many hours' labor will be 
needed by a man suited to the task working 
at his best normal rate. This is simply get- 
ting up a set of specifications for the labor 
we wish to buy, and is directly comparable 
to a set of specifications for a machine or a 
machine tool. The man who buys the latter 
without specifications is often disappointed 
even though the manufacturer may have 
tried earnestly to anticipate his wishes ; and 
the man who buys the former under the same 
conditions has in the past almost universally 
found that a revision of his contract price 
was necessary in a short time. The relative 
importance of buying labor and machinery 
according to the best knowledge we can get, 
and the best specifications we can devise, is 
best illustrated by the fact that while the 
purchase price of a machine may be changed 
whenever a new one is bought, that of the 



EFFICIENT UTILIZATIOjST OF LABOR 47 

labor needed to do a piece of work should be 
permanent when it is once fixed. 

As was said before, few men can work np 
to these specifications at first, if they are 
properly drawn, but many men will try if 
they are properly instructed and assured of 
the ultimate permanent reward. Most men 
will not sacrifice their present wages to earn 
a higher reward in the future, and even if 
they were willing few men could afford to. 
Therefore, while they are learning to per- 
form the task, they must be able to earn their 
usual daily wages, and the reward for the 
accomplishment of the task must come in the 
form of a bonus above their daily wage. 

Increase in efficiency makes the payment 
of high wages possible, and it may be added 
that without efficient labor, high wages can- 
not be paid indefinitel}^, for every wasteful 
operation, every mistake, every useless move 
has to he paid for by somebody, and in the 
long run the tuorkman has to bear his share. 
Good management, in which the number of 
mistakes is reduced to a minimum, and use- 
less, or wasteful operations are eliminated, is 
so different from poor management, in which 
no systematic attempt is made to do away; 
with these troubles, that a man who has al- 



48 WORK, WAGES, AND PROFITS 

ways worked under tlie latter finds it ex- 
tremely difficnlt to form a conception of the 
former. The best type of management is 
that in which all the available knowledge is 
utilized to plan all work, and when the work 
is done strictly in accordance with the plans 
made. The best mechanical equipment of 
a plant that money can buy avails but little 
if labor is not properly utilized. On the 
other hand, the efficient utilization of labor 
will often overcome the handicap of a very 
poor equipment, and an engineer can have 
no greater asset than the ability to handle 
labor efficiently. 

The subject of wages is then inextricably 
bound up with that of management. Poor 
management usually means poor wages. 
Grood management means good wages, for 
the high efficiency demanded by good man- 
agement can only be maintained by such 
wages as will attract good men and induce 
them to work at their highest efficiency. 

The manager who boasts of the low wages 
he is paying for his work would generally 
find, if he had a reliable cost system, that his 
costs were greater than those of his compet- 
itor who paid better wages. 



1 



THE COMPENSATION OF WOEKMEN 



Chapter III 

THE COMPENSATIOISr OF WOEKMEN" 

TX7"E all like to feel that we are passing 
^ ^ away from the age of violence, and 
approaching an age when justice and equity 
will have more influence in the world than 
hrute force. If we rely too much upon the 
progress already made, however, we are 
bound to get into trouble. Kipling sounded 
a world note in his lines : 

"An^ what 'e thought 'e might require, 
'*E went and took, the same as me." 

As far then, as acquiring property was 
concerned, he put the ancient Greek and the 
modern Briton in the same class. The Jap- 
anese-Eussian war was caused by the fact 
that each of two powerful nations wanted 
the property of a third weak one. Neither 
had any right to it, but the fact that each 
wanted it was enough to set aside all ques- 
tions of right. Eecently the seizure of the 
provinces of Bosnia and Herzegovina by 
Austria was another example of an act done 

51 



53 WORK, WAGES, AND PROFITS 

because the aggressor had the power to do it. ^ J 
The present alarm in Great Britain over "^ 
Germany's armaments is not due to the fact^,^t^C 
that England thinks there is any real cause ''' 
for a war, but the fear that if Germany has 
the power it will be used to the detriment of 
Britain. In other words, it is still accepted 
as common practice that "they should take 
who have the power and they should keep 
who can.'' 

To come a little nearer home, we find that 
large corporations are not very much more 
squeamish, or particular, than large nations. 
The Standard Oil Company, the Beef Trust, 
the Sugar Trust, and any number of others, 
have absolutely no regard, apparently, for 
right or wrong. They get what they can 
by any means available. The difference be- 
tween the savage and civilized communities 
is largely that the civilized communities have 
enacted laws which tend to restrain individ- 
ual greed. Inasmuch, however, as it is im- 
possible to foretell all the forms individual 
greed may take, it is impossible to enact in 
advance laws to cover all possible cases, and 
the best that can often be done is to make 
new laws to restrain new forms of greed as 
fast as they develop. Laws were made long 



THE COMPENSATION" OF WORKMEN 53 

ago that restrained robbers, sneak thieves, 
and even the ^^ robber barons,'' but none 
have so far been framed that restrain the 
'^high financier,'' who, without giving any- 
thing in return, taxes the community for his 
own benefit to an extent that makes all other 
forms of acquiring without giving an equi- 
table return seem utterly insignificant. One 
of the foremost American patent lawyers not 
long ago stated that the tremendous indus- 
trial success of the United States had been 
largely brought about by its beneficent pat- 
ent laws, and yet the greatest part of the 
legal talent among the patent lawyers is en- 
gaged in evading those very patent laws, 
which are so beneficent to the community. 
These statements only go to show that in 
general it is only in so far as the laws re- 
strain, that men fail to take advantage of 
each other. Certainly there are many hon- 
orable exceptions. There are many people 
who are actuated by higher motives, and 
who are doing a great deal to advance the 
cause of equity and justice, and to establish 
proper relations between human beings, and 
we give them all credit. But if we consider 
their methods the rule, and base our plans 
on them, we shall find that others, not quite 



54 work:, wages, and profits 

so scrupulous as we are, will get the better 
of us. Therefore in discussing tlie relations 
between employer and employed, we must 
recognize the fact that in the majority of 
cases, men still act on the principle that 
^'they should take who have the power and 
they should keep who can.'^ 

This is true whether you are speaking of 
employer, or employed. Labor unions are 
just as insistent in their demands for things 
that do not belong to them, as the Sugar 
Trust is in its efforts to evade duties that it 
ought to pay. One of the best illustrations 
of this spirit of which I ever heard, was in- 
cident to the ending of a strike in a West- 
ern State, where the labor union had won. 
Soon after the men had gone back to work, 
one of the employers said to a workman, ^^I 
hope you are satisfied now." ^^No!" said 
he, *'we are not satisfied, and we never shall 
be, until we come to the works in our car- 
riages, and you walk!'* 

As long as the interests of the employer 
and employee seem antagonistic there will 
be conflict, and in any discussion of the sub- 
ject, we must recognize that antagonism 
means conflict. Until we can find some means 
of doing away with the antagonism, the con- 



THE COMPE^TSATION OF WORKMEIsr 55 

flict will continue. Our search, then, must 
be for such means. 

If the amount of wealth in the world were 
fixed, the struggle for the possession of that 
wealth would necessarily cause antagonism; 
but, inasmuch as the amount of wealth is not 
fixed, but constantly increasing, the fact that 
one man has become wealthy does not neces- 
sarily mean that someone else has become 
poorer, but may mean quite the reverse, es- 
pecially if the first is a producer of wealth. 
The production of wealth can be so greatly 
facilitated by the co-operation of employer 
and employed that it would seem that if the 
new wealth were distributed in a manner 
that had in it even the elements of equity, 
neither party could afford to have the work- 
ing arrangement disturbed. 

As long, however, as one party — no mat- 
ter which-^tries to get all it can of the new 
wealth, regardless of the rights of the other, 
conflicts will continue. 

On account of the disregard of law and 
order that unions so frequently show in their 
strikes, it is the fashion in many places to 
condemn them as utterly bad, when they are 
only human. As a matter of fact, they are 
not all bad by any means. They have done a 



56 woek:, wages, ais^d profits 

great deal for tlie cause of workmen. If it 
liad not been for them, the working people 
of today wonld probably be in the same con- 
dition as were those of England sixty or a 
hundred years ago. The average workman 
is a good citizen, just as loyal to his country 
as the capitalist, and just as proud of its po- 
sition in the world. He is even more inter- 
ested in its prosperity, for in times of de- 
pression, when the capitalist loses his sur- 
plus, the workman loses his means of living. 
It is a realization, perhaps, of the small mar- 
gin that they have above their absolute 
needs, that makes workmen so liberal to each 
other, for it is a well-known fact that the 
wage earner is far more liberal than the cap- 
italist. He will go much further out of his 
way to help a friend than the rich man will, 
although it is much harder for him to do so. 
Our method of studying labor problems 
in detail, and studying the individual work- 
men, has taught us much about them and 
given us a high opinion of them as men. The 
proportion of high-minded and honest men 
is just as great among them as among any 
other class, and far greater than among 
those people we continually hear complain- 
ing of them. Of course there are worthless 



THE COMPENSATION^ OP WORKMEN 57 

and dishonest men among tliem, bnt the pro- 
portion is no greater than among those who 
have better opportunities. There are many 
individuals who do what they can to help 
their less fortunate friends, and there may 
be unions formed to help the poor workman ; 
but as a business proposition, such a union 
cannot long be successful. Unions are 
formed, as a rule, by men of energy to help 
each other, and the poor workman is taken in, 
not for the good he does in the union, but 
the harm he does if not in. The poor work- 
man is thus advanced with the good, and the 
employer pays the bill. 

It is undeniable that unions have advanced 
the cause of workmen in general, and we 
must not blame them for using force to ac- 
complish their ends. It was the only means 
they had. If we wish them to use any other 
means we must provide them with a means 
that they will consider more desirable, and 
that will give better results, for in this coun- 
try, so long as a man conforms to the laws 
of the State, he has a right to govern his 
actions in such a manner as his interests 
seem to dictate. Men join the union because 
they think they will be better off in the long 
run. for being in the union. The idea of the 



58 WORK, WAGES, AND PROFITS 

union is to get a higher rate of wages for 
the whole class, because in general nobody 
in that class can get a substantially higher 
rate unless the whole class gets a higher rate. 

The employer usually pays but one rate of 
wages to one class of workmen, because, as 
a rule, he has no means of gauging the 
amount of work each man does. It is exceed- 
ingly difficult to keep an exact record of what 
each of a number of men does each day ; and 
even if he had such records, the difficulty of 
comparing them would be very great, unless 
the work done by each man was of the same 
nature, and done under the same conditions. 
The result is that he keeps no individual 
records, but usually treats all workmen of a 
class as equals, and pays them the same 
wage. There may be 20 per cent, who are 
very much more efficient than the rest, but he 
has no way of distinguishing them from the 
others with any degree of certainty; hence 
he declines to increase any wages, or makes 
the difference in wages insignificant as com- 
pared to the difference in efficiency. 

In hiring men he offers the wages he can 
get the cheapest man for, and if the good 
man stood out for higher wages, he would not 
get any wages at all. Hence if the good 



THE COMPENSATION OF WORKMEN 59 

man is to get high wages, the whole of his 
class must get high wages. This is the 
strongest argument for the formation of la- 
bor unions, and when they are successful in 
raising the class wage, as they have repeat- 
edly been, the employer is forced to pay the 
poor man more than he is worth. 

The desire of the union to take in all the 
members of its class is not philanthropic. 
Self-preservation is the first law of nature. 
Under ordinary conditions a man will ad- 
vance himself first, and his neighbor next. 
He will join the union to advance his own in- 
terests, and it is only right and natural that 
he should advance his own interests. Any 
community made up of people who did not 
advance their own interests would very soon 
go to pieces. If a workman thinks it is to 
his interest to join a union, he has a legal 
right to do so. If we v/ish to prevent him, 
we must make it to his interest not to do so. 
In other words, we must provide him with v 
means of advancing his interest that is su- 
perior to what the union offers. If any such 
scheme is to be permanently successful, it 
must be beneficial to the employer also. 

Under ordinary conditions where there is 
no union, the class wage is practically gauged 



60 WOKK, WAGES, AND PROFITS 

by the wages the poor workman will accept, 
and the good workman soon becomes dis- 
couraged and sets his pace by that of his 
less efficient neighbor, with the result that 
the general tone of the shop is lowered. 

On the other hand, when the union has had 
the class wage raised, the inefficient work- 
man is demoralized by getting more than he 
is worth, while the efficient man still does 
less than he could, for it is not absolute 
wages that stimulate exertion, but difference 
in wages. 

Thus under both non-union and union con- 
ditions, where no individual records are kept, 
the employer fails to get the efficiency he 
should, and the general tone of the shop runs 
down. This is very marked in many old 
shops which have been successful in the past. 

If shops are to be continually successful 
the efficiency of the workmen must not only 
not be allowed to decrease, but must be sys- 
tematically increased. Increase of efficiency 
is essentially a problem of the manager, and 
the amount to which efficiency can be in- 
creased by proper management is in most 
cases so great as to be almost incredible. 
Decrease in efficiency is not, as a rule, the 
fault of the workmen, but of the manage- 



THE COMPENSATION" OF WORKMEN" 61 

ment, and the manager who continually com- 
plains of the decreasing efficiency of labor is 
simply advertising his 0"wn incompetence. 

There are only two methods of paying for 
work ; one is for the time the man spends on 
the work, and the other is for the amount 
of work he does. The first is day work. The 
second is piece work. All other systems, 
whatever may be their name, are combina- 
tions of these two elementary methods in dif- 
ferent proportions. It is natural that the 
employer should wish to get all the work he 
can for the money he spends. It is also nat- 
ural that the workman should wish to get all 
the money he can for the time he spends. 
Any other condition would be wrong, would 
be almost suicidal. These two conditions 
seem to be so antagonistic that most people 
give up any attempt to harmonize them, and 
adopt a scheme of bargaining. Bargains, as 
a rule, are made for a definite length of time, 
at the end of which they are revised. Under 
such a system the most aggressive group, or 
the one that has the most favorable condi- 
tions, wins in the long run. 



DAY WOEK 



Chapter IV 
DAY WORK 

DAY WOEK, or that in which men are 
paid for the time they spend, may be 
divided into two classes: first, ordinary day 
work in which there is no attempt made to 
keep individual records, and every man of 
a class receives the same wages regardless 
of the amount of work he does ; second, that 
in which the work is carefully planned be- 
forhand so that each man can have contin- 
uous work, and so that an exact record can 
be kept of what he does, and liis rate of pay 
adjusted accordingly. 

The day rate of any class of men, such as 
laborers, weavers, machinists, moulders, etc., 
is regulated by supply and demand, except 
where it is regulated by the union; and in 
times of extreme depression even the unions 
are unable to keep up the rate. The rate 
may be, and usually is, different in different 
localities. Under the condition where no in- 
dividual records are kept, it does not make 
much difference whether one man is more 

65 



QQ WORK, ^YAGES, AJTD PROFITS 

efficient than another or not; it is almost 
impossible for Mm to get a higher rate of 
wages than the rest of them. If the pay of 
one is raised, others are apt to claim that 
they also are entitled to an increase, and in 
the absence of records it is impossible often 
to disprove their claim. To save discussion, 
then, and possible trouble, the employer de- 
clines to sanction any increase of pay. The 
indnstrions and efficient man naturally be- 
comes dissatisfied and gradually slackens his 
pace to that of the poorer workman. Thus 
the employer, who pays only the rate the 
poorer man can earn, gets only the efficiency 
he pays for, even from his capable man, who 
thus works far below his capacity. 

This method of buying labor is similar to 
bu}dng all materials sold under the same 
name at the same price, without regard to 
quality; but it is much more wasteful, as the 
difference in the quality of materials is sel- 
dom as great as the range of efficiency in 
workmen. 

The result of this policy — and it is the 
logical result — is that the efficient man, the 
man with boundless energy to spare, says: 
^'I can't get any more money by doing more 
work. I am going to see if I can get it some 



DAY WORK 67 

other way." Then he organizes all his fel- 
lows into a nnion, and they all say, ''We 
want more money!" and they get it, and no 
man cares whether he does more work or 
not. The moral tone of the shop and the 
community is lowered, as is always the case 
when there is a resort to force. 

In the second class of day work some intel- 
ligent man studies the work to be done, lays 
it out carefully, perhaps several days ahead, 
provides the proper appliances, divides it up 
in such a manner that it can be done by in- 
dividuals or by men in small gangs, so an 
exact record can be kept of what each indi- 
vidual or gang does, and compensation be 
made accordingly. Such a method of hand- 
ling workmen has exactly the reverse ef- 
fect, and their efficiency begins to increase at 
once. When we increase one man's wages 
because his record shows he deserves it, it 
not only does not cause trouble with the other 
workmen, but it acts as a stimulus to them, 
and we are glad to have each workman know 
what the others are making. 

It is difficult and often impossible, es- 
pecially at first, to plan all the work of a 
plant and to keep a record of each workman, 
but some planning can be done, and some rec- 



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68 



DAY WORK 69 

ords kept in almost every case ; and if a few 
steps in this direction are taken, tlie advan- 
tage of taking more will soon become evident. 

Some years ago it became necessary to 
lay off about ten monlders in a foundry work- 
ing on day work with the record system. 
The superintendent sent for the records, and 
having inspected them, he sent the foreman 
a list of the men to be laid off. There was 
a great complaint, in which the foreman 
joined, that the wrong men had been se- 
lected, and that some of these men were the 
best in the shop. The superintendent in- 
vited an inspection of the records, which the 
foreman had never been willing to pay any 
attention to before, with the result that 
ever3^body was satisfied, and the efficiency of 
those remaining soon showed a very marked 
improvement. 

If the conditions are such that we can 
plan out the work ahead of time, we will get 
a fair degree of efficiency by keeping indi- 
vidual records of the workmen, and raising 
their day rate accordingly. As a matter of 
fact, a better efficiency can be obtained by 
this method than by the ordinary system of 
piece work, where the rates are set by past 



70 "work:, wages^ and profits 

records or the estimates of the foreman ; and 
the tone of the shop is far better. 

We began the use of individual records in 
a steel foundry in 1888, and have since al- 
ways tried to plan onr work so that records 
could be kept. "With the introduction of our 
task and bonus system in the Bethlehem 
Steel Works, in 1901, the method of keeping 
these records became standardized. Page 68 
shows a sample of the man-record sheet in- 
troduced in the works of the American Loco- 
motive Co. in 1902. 

Not long ago a large contractor in New 
York, who had been studying methods of 
handling his workmen efficiently, spent some 
time on one of his large excavating jobs. 
He provided a sufficient number of buckets, 
so that each man was always shoveling into 
a bucket by himself, and kept track of the 
buckets filled by each man. At once the num- 
ber of buckets that came out of the hole was 
doubled. 

No record can, as a rule, be kept of men 
doing miscellaneous work unless it is prop- 
erly planned ahead of time with that object 
in view. If it is intelligently planned and 
an increased compensation given for in- 
creased efficiency, an improvement will re- 



DAY WORK 71 

suit wMch will far more tlian pay for the 
expense of planning and record-keeping. 

If, then, you train a man to be efficient and 
adopt a system of management which en- 
ables him to utilize all of his energies in pro- 
ductive work, you can afford to pay him far 
higher wages than he can get where the 
workmen are not trained and where the sys- 
tem of management is not such as will en- 
able him to work continuously and efficiently. 

A weaver in a cotton mill accustomed to 
having his warp ready and filling properly 
supplied, complains very bitterly if anything 
goes wrong. A man accustomed to having 
materials and appliances provided, objects 
strongly to being obliged to hunt up his own 
materials or appliances, even if he is re- 
quired to get a correspondingly smaller 
amount of output. We have had many ex- 
amples of workmen trained to work under 
an efficient system of management, who ob- 
jected to working under an inefficient system. 

One of the best examples of this occurred 
at the Bethlehem Steel Works, where men 
were unloading coal from cars at a rate of 
four cents per ton. They heard that men 
were getting six cents a ton in Pittsburgh for 
this work, and six of them left and went to 



72 woke:, ttages, axd profits 

Pittsburgli. At Betlileliem they were work- 
ing two men on a car. At Pittsburgh six or 
seven men were put on a car, and these Beth- 
lehem men were spread around, so that there 
were always strangers on the car with them. 
They started to work just as hard as at 
Bethlehem, but the other fellows didn't. The 
harder these trained men worked, the less 
the others did. The faster workers very 
soon slowed up, and in about two months the 
whole gang came back, and said they could 
not make as much money at Pittsburgh in the 
large gangs at higher wages as they did at 
Bethlehem at lovver wages. It is a well- 
known fact that men in large gangs do not 
work as efficiently as men do individual^, or 
in small gangs, but the man in charge of the 
work in Pittsburgh apparently did not know 
it. 

To summarize : If 3'ou keep an exact rec- 
ord of what each worker does, surround the 
men with conditions under which they can 
work at high efficiency, and compensate the 
efficient ones liberally, no man will spend his 
spare time trying to find out how to raise the 
wages of the other fellow. Workmen, as a 
rule, will do more work if their earnings are 
increased by so doing, and you will find great 



DAY AYORK 73 

difficulty in getting tlie efficient ones into la- 
bor unions if tliey are not benefited by join- 
ing. 

The point that seems very clear is that the 
employer is quite as much responsible for 
the labor unions as the men are themselves, 
and that he can never expect to adjust his 
difficulties with the employees until he fur- 
nishes them with a means of accomplishing 
their ends (namely, bettering their condition 
and getting more money) which will appeal 
to them as being better than the means that 
they are now using; for as was said before, 
so long as he conforms to the laws of the 
State the workman has a right to govern his 
actions in the manner that will best subserve 
his own interests. As we cannot make him 
do anything, we must accomplish our object 
by convincing him that what we offer is bet- 
ter than what he already has. When he is 
convinced, the problem is solved. 



PIECE WOEK 



Chapter V 
PIECE WOEIv 

THE one fact underlying tlie philosophy 
of labor management developed in the 
preceding chapters, is that it is not the work- 
men who are chiefly at fault for the incon- 
sistency and inefficiency of most payroll dis- 
bursements, but the system generally used 
in handling the workmen. Under the sys- 
tem that oftenest exists we cannot expect the 
workman to be much different from what he 
is. If w^e were in his place, we should prob- 
ably do as he does. We should want to make 
the best living we could for our families, and 
if by working honestly and conscientiously 
we could not make any more money, and if 
we had tried it over and over again, and still 
could not get any more, even though we did 
twice or three times as much as the poorer 
worker beside us, we should do the same 
thing the average worker now does ; namely, 
come to the conclusion that the system un- 
der which we were working had no provi- 
sion for compensating the individual aceord- 

77 



78 WORK, WAGES, AN^D PROFITS 

ing to his deserts, and that the only way we 
could get more money for onr services was 
to get the wage rate of onr class raised, and 
take steps to this end. 

This is exactly what the men do. The em- 
ployer has forced them into a class by keep- 
ing their wages uniform, and it is bnt a short 
step from such a class to a union. With the 
union comes first collective bargaining, then 
demands, then strikes. This is a logical 
series, for a successful bargainer always 
wants a better bargain next time, and the 
demand that is successful is very apt to be 
followed later by one that will yield more 
still, even if it takes force to sustain it. 

As was said in a previous chapter, most 
workmen are good citizens, and if we can 
show them peaceful means by which they can 
get equitable compensation, they will have 
but little desire to resort to force. As has 
been said before, we recognize that our 
method of keeping individual records and 
compensating the individual accordingly is 
not easy, and in many cases may be impossi- 
ble, but we have found that an honest ef- 
fort to do it has always produced a feeling 
of confidence and loyalty among the work- 
men, which added much to their efficiency. 



PIECE WORK 79 

So far our discussion of tlie subject has 
related only to day work. An investigation of 
the subject of piece work also reveals incon- 
sistencies similar to those already consid- 
ered. In the term piece work we include all 
the various schemes for compensating men 
for what they do^ instead of for the amount 
of time they tuorh. It may be divided into 
two general classes. 

The first is that in which a price for a job 
is set from previous records or from the es- 
timate of a foreman, who generally considers 
his duty done when he has set the price. 

This method is the one in general use and 
until recently it has been almost exclusively 
employed. In recent years, however, it has 
been very generally modified in order to 
avoid the troubles that have so frequently fol- 
lowed such piece work in the past. The fol- 
lowing reasons seem to be amply sufficient 
to account for the labor troubles that have 
been caused by this kind of piece work. 
i Eecoeds of what has been done are only 
a very poor indication of what can be done 
by a capable and industrious workman, and 
still may be far beyond the possibilities of 
an ordinary workman who has not had spe- 
cial training in the work. 



80 WORK, WAGES, AND PROFITS 

Estimates of a busy foreman as to how 
long it should take to do a new job must 
necessarily be inaccurate, and rates set by 
his estimates are practically guesses. After 
the workmen have become skilled, their earn- 
ings will increase greatly and will often be 
out of all proportion to the exertion put 
forth. 

Under these conditions an adjustment of 
the prices based on the new records is made ; 
and, as the workmen become more skillful, 
it is done again. Thus the more skilled the 
workman becomes, and the more progress he 
makes, the greater the penalty he has to suf- 
fer, for his prices are being continually re- 
duced so that he earns but little more than 
the incompetent man, who has never been 
able to do his work in such a manner as to 
exceed greatly the old records. 

The effect of this method of penalizing the 
good ivorkman in proportion to his increased 
effort is to discourage him so that he learns 
ultimately to limit his output by that of the 
poor workman. This result is so natural 
that we should not be surprised at it, nor 
should we condemn it, unless we make it to 
the interest of the workman to do otherwise. 
His desire for more money continues, how- 



PIECE WORK 81 

ever, and when lie finds his piece rate re- 
duced whenever he earns much more than 
the average workman, he comes to the con- 
clusion that as his employer seems deter- 
mined to keep him in his class so far as com- 
pensation is concerned, he will see what he 
can do to better the financial condition of 
the class. 

The fact that he has had to suffer a pen- 
alty for trying to advance himself by legit- 
imate methods, however, has caused him to 
feel that might is more powerful in the world 
than right. No better way could possibly 
be taken to teach him the value of force in 
accomplishing his ends. 

We cannot blame him if he now spends his 
extra energy in forming his union, for in the 
past unions have done more for the work- 
man than he could do for himself. If we 
wish him to abandon the use of force, we 
must assure him of an equitable return for 
his efforts without it. Inasmuch as in the 
union, as was previously shown, the good 
man seldom gets all he is worth, we can get 
the good men on our side, if we can convince 
them that their efforts will be adequately 
rewarded. 

This brings us to the second system of 



82 wore:;, wages, and profits 

piece work, wHcli wlien properly operated 
provides a complete system of instruction 
for the workman, equitable compensation for 
his efforts, and opportunity for advance- 
ment on his own merits, and not through 
*'pulP' or friendship. So far this system 
has never failed to create a strong spirit of 
harmony and co-operation. 

The essentials of this system are: 

FiEST, to have the best expert available 
investigate in detail every piece of work, 
and find out the best method and the shortest 
time for doing it with the appliances to be 
had. 

Secoi^d, to develop a standard method for 
doing the work, and to set a maximum time 
which a good workman should need to ac- 
complish it. 

Thied^ to find capable workmen, who can 
do the work in the time and manner set, or 
to teach an ordinary workman to do it. 

FouETH, whenever the high efficiency is ob- 
tained, to compensate liberally not only the 
workman actually doing the work, but also 
those who supply him with materials and ap- 
pliances to enable him to maintain the effi- 
ciency specified. 

Fifth, to find amon^' the workmen who 



PIECE WORK 83 

have learned the best ways of doing work, 
some that can investigate and teach, and thus 
gradually to get recruits for the corps of ex- 
perts, SQ that the system may be self-per- 
petuating. 

Sixth. The ordinary foreman of the shop 
must not be called upon to do the work of 
the expert. His business under the usual 
conditions of management is that of an ex- 
ecutive, and he is invariably so busy attend- 
ing to his routine duties that he has but lit- 
tle time to make investigations into the best 
method of doing work. He can only give in- 
structions according to the experience he has 
had in the past, or according to the knowl- 
edge he may pick up at odd times. Again, 
he frequently feels compelled to allow work 
to be done inefficiently because he has no man 
that can do it better, and no time to train a 
new man. For these reasons it is desirable 
that the development of improved methods, 
the setting of tasks in accordance with these 
methods, and the training of workmen to 
perform these tasks, should be in the hands 
of some one other than the foreman. 

For this purpose the best expert mechanic 
available should be selected. Such a man 
may not have qualities at all fitting him to 



84 WORK, WAGES/ AND PROFITS 

be a foreman — in fact, the best expert usually 
makes but a poor foreman. He is generally 
so absorbed in tlie meclianical operations 
themselves tliat the improvement of tliem 
becomes a passion witli him, and nothing 
pleases him more than to see numbers of 
machines operating at their highest efficiency, 
the result of his work. On the other hand, 
the foreman with this kind of a mind often 
sacrifices other sources of efficiency for this 
object. The expert must be a good mechanic, 
with fair education. He must have indus- 
tr}^ originality, persistence, and an ability 
to remove obstacles, not once, but repeatedly. 

Such an expert in a sliop will study the 
machines individually and teach workmen to 
bring each up to its highest efficiency. 

While the policy advocated in the above 
paragraphs cannot be called a system of 
management, the elements described must be 
parts of any good system. Each individual 
problem of manufacture must be studied in 
such a manner as to determine how the work 
can be done in the most efficient way. 

There is no use in attempting to increase 
efficiency, however, unless it is done in a sys- 
tematic manner. Managers will often tell 
you that you cannot put into their shops 



PIECE WORK 85 

methods of this character, and, under the 
conditions that exist, they are right. In 
many places you cannot at once better the 
evident inefficiencies that exist, for the ma- 
chinery is often so arranged that it is ex- 
tremely difficult to do anything different 
from what is already being done. 

Most plants have grown from small begin- 
nings, and have been added to without any 
definite plan, or any real idea of the system 
to be used in operating them. In many cases 
the character of the work has changed, and 
a plant well adapted for one class of work 
may be so arranged as to make it impossible 
to do another class of work efficiently. Then 
there are plants in which the machinery has 
been arranged without considering the sub- 
ject of efficient management. In most plants, 
at least one of the above conditions exists to 
such an extent that much of the machinery 
must be rearranged to make any great im- 
provement. 

Then there are some people who have no 
idea of doing anything in a systematic man- 
ner. They cannot do anything twice the same 
way. They may be very good people, with 
an artistic temperament, perhaps, or they 
may be chronic inventors. They like to 



86 "WOEK^ WAGES^ AXD PROFITS 

change things. If yoii have a man like that 
at the head, and succeed once in getting the 
plant organized for efficient work, he will 
want to change things again to-morrow. Snch 
a man is not a manufacturer, and will make 
a much greater success at something else. 
To attempt to make permanent under such 
a man an efficient arrangemicnt of machinery, 
or system of management, is futile. 

On the other hand, if the man at the head 
is systematic, and while capable of recog- 
nizing an improvement, is slow at making 
changes unless he can see distinct benefit 
from them, the conditions for instituting 
such reforms as will permanently add to the 
efficiency of the plant are ideal. 

When we have once established our sys- 
tem of management by which the work is 
done economically, and the workmen get 
higher pay, they themselves offer the strong- 
est opposition to change, for they will stand 
by a good system under which they are ben- 
efited quite as staunchly as they did by the 
forty-year-old method it replaced, the only 
virtue of which, perhaps, was its age. 

Before beginning to introduce the methods 
described we must study the conditions un- 
der which the work is to be done. The ma- 



PIECE WORK 87 

chinery must be so arranged that the work 
can be done economicallyj and provision must 
be made to have the proper materials and 
appliances always available for the work- 
men. This is a question of management, and 
may have qnite as much effect on the proper 
operation of a plant as anything the work- 
men can do.* 

Having placed our machinery so that it 
can be operated efficiently and arranged for 
a proper provision of materials and appli- 
ances, the first problem is to determine the 
best way of doing a piece of work. Usually 
there are in every shop some workmen who 
are much more capable than the others. If 
the best of these can be interested in our 
work, the problem of studying the work in 
detail is much simplified. In connection with 
such workmen, our observer, or ^^time study'' 
man, can make a detailed scientific study of 
all the elements of a piece of work and de- 
termine the best method for doing it and the 
shortest time in which it can be properly 
done by an experienced man working at his 
best normal speed. Having determined such 

*A paper presented before the American Society of 
Mechanical Engineers, July, 1903, and entitled "A 
Graphical Daily Balance in Manufacture," goes into 
this subject somewhat. 



88 WORK, WAGES, AND PEOFITS 

a time and metliod, ihej are adopted as 
standards, and the workmen should be 
awarded liberal compensation for doing the 
work by the method and in the time set. 

As a rnle it is best to study, if possible, 
the work as done by several good workmen. 
If it is understood that the most efficient will 
be given the work at a fair rate, we are 
usually able to secure their co-operation in 
fixing that rate. 

If it is necessary to train several work- 
men, the very best man should be made an 
instructor and compensated liberally for 
teaching the others his knowledge and skill. 

In machine shops, or other places where 
many tasks are to be set, the investigator or 
task setter should be the most expert work- 
man available, and his compensation should 
be such as to make him jealous of his job. 
If any workman often succeeds in doing the 
work in less than the time set, we mark him 
— not to have his rate cut — but as a prom- 
ising candidate for an instructor's, or task- 
setter's, job. As a matter of fact, our trained 
workers often yield a good supply of instruc- 
tors and occasionally a task-setter. 

We thus provide means for the workman 
to learn the best practice we can devise, and 



PIECE work: 89 

not only compensate liim liberally for fol- 
lowing it, but give liim a chance to advance 
himself still further if he has the ability to 
do so. 

When it is clearly understood that we mean 
to do this, we have no difficulty in securing 
the hearty co-operation of the workmen. 

After a proper study we should know the 
time needed by a good man to do the work 
with the same certainty that we know it is 
possible for a good healthy man to walk 
four miles per hour for several hours. We 
know, however, that if we go out into the 
street, and ask a dozen men at random to 
walk to a place four miles off in an hour, 
they will all probably have great difficulty 
in doing it. If we ask them to go eight miles 
in two hours, the great majority of them 
will fail. If we extend the walk to twelve 
miles in three hours, almost none of them 
will accomplish it. Suppose, however, we 
know a man who can walk four miles per 
hour readily, and get him to teach others to 
do it. If we make it to the interest of the 
others to do as they are taught, our expert 
can soon teach them by walking them, per- 
haps, the first day, only one mile in a quar- 
ter of an hour; the second day, two miles 



90 WORK, WAGES, AND PROFITS 

, in half an lionr ; in a day or two four miles 
in an hour, then six miles in an hour and a 
half. He soon gets them so they can walk 
day after day at that rate without any diffi- 
culty. "We have the same problem in doing 
any kind of work. If a man is trained to do 
a certain kind of work at a certain speed, he 
will do it at that speed, even though it may 
have been absolutely impossible for him to 
do it at that rate before he was trained. 

Training takes time, and training a man 
to work rapidly and well is a much more 
difficult job than training a man to walk fast. 
Therefore, after our expert has found the 
best way and the best speed for doing certain 
work, his job is still often only half done. He 
must find somebody who can be trained to do 
it in that way at that speed. Frequently 
we know it should be done at that speed, but 
cannot find anybody to do it. Our investiga- 
tion may show that a job can be done in an 
hour, and yet the best result we can get may 
be an hour and a quarter, or an hour and a 
half. Every worker in the place may say 
he cannot do it, and nobody may be willing 
to try. But if our studies are correct, and if 
we patiently train people, experience proves 
that we can eventually get some one to do it. 



PIECE WORK 91 

If the man wlio is doing tlae work is suc- 
cessful in performing his task in the time 
and manner specified, he, of course, gets ex- 
tra compensation; but this is not enough. 
The men who supply him with the means of 
doing the work must also get extra compen- 
sation, for unless you can make it to their 
financial interest to co-operate, the worker 
may fail for want of their co-operation. On 
the other hand, if they do get extra compen- 
sation when the individual is successful, 
there will be a complaint from some one if 
he is not successful. If his failure is due to 
the man supplying the materials this man 
will be criticised, not so much by the super- 
intendent as by the workman himself. If the 
workman often fails from his own ineffi- 
ciency, the helper, who also loses, will com- 
plain. Not long ago an illustration of this 
occurred in a cotton mill. A slow-moving 
fellow you would hardly think could do a full 
day's work, finally woke up, and became a 
good weaver, earning his extra compensation 
nearly every day. One day the proper ^ ^ fill- 
ing'' was not ready for him in time. The 
foreman heard a great row in the weave 
room, and, looking around, found this fellow 
about ready to take off the head of the man 



92 WORK, WAGES, AND PROFITS 

whose duty it was to supply the filling. That 
man had energy enough, but he had only re- 
cently learned to use it, and the object les- 
son he gave helped the whole room. 

After we have studied a job and set the 
task, it should be our invariable rule never 
to change it unless we change the method of 
doing it. If, in spite of careful study, we 
find we have made a mistake, we must sim- 
ply accej)t the consequences of that mistake. 
We may some day find a better way of doing 
the job. In this case we may change the task 
by adopting that as our method, and teach- 
ing it to the workmen. As long as the work 
is done by the same method, however, we 
should seriously impair the efficiency of the 
whole place if we attempted to increase the 
difficulty of the task. SupjDose we have de- 
cided, after careful study, that 10 pieces 
is a daj^'s work. If our people become ex- 
ceptionally skillful and do 12 or 14, it is well 
worth our while to have them do so. 

On the other hand, if an attempt is made to 
increase the task as the workers become more 
skillful, the workmen will logically decline 
to do the increased task, if the original task 
is a fair one. Suppose the employer insists 
on his point, and lets his trained workers go. 



PIECE WORK 93 

If his task is a proper one, his new gang will 
be unable, as a rule, to do more than half 
as much as his trained gang, aud hence he 
will need twice as many people and twice as 
much space to get out the same product» 
Twice as many people require at least twice 
as much supervision, and if they are un- 
trained and new in the shop, more than twice 
as much. In addition, the product of the un- 
trained workers is sure to be decidedly in- 
ferior to that of the good workers, and alto- 
gether the loss to the employer is likely to 
be many times the possible gain by the sav- 
ing in wages. 

"When, therefore, we have a lot of efficient 
men, working harmoniously, we can afford 
to pay them big wages rather than try to 
change things at all. A certain mill for- 
merly had the reputation of paying poor 
wages, and, of course, had difficulty in get- 
ting good help. Now, under this system, it 
pays the best wages and draws the cream of 
the help from all around. Every man in that 
mill knows he has the best job he can get, 
and he comes every day to take care of it. 

If the men know that the employer will 
stand by his word, and not change the time 
for performing a task when it has been once 



94 wore:, "WAGES, an"d profits 

set, they soon get confidence in him, and the 
problem of increasing the efficiency of the 
plant becomes easy. 

In attempting to increase the efficiency of 
a plant, then, the first problem is to convince 
the workmen of onr good faith and that they 
will be treated fairly. When this has been 
done, we always have their co-operation to a 
degree entirely unsuspected by those who 
have never tried that method. 

We must remember, however, that proper 
piece rates and loyal workmen are only ele- 
ments in producing efficiency. They have 
but little effect unless there is system of 
management that tends to harmonize all the 
various elements upon which efficiency de- 
pends. 

In fact, a broad-minded manager who un- 
derstands the relative importance of the va- 
rious operations carried on in the plant, and 
who adopts a policy which has a tendency to 
harmonize these various operations, can ac- 
complish more with individual records and 
day work than can be accomplished by the 
best possible piece rates without a harmoniz- 
ing system of management. 

In any attempt to increase efficiency, there- 
fore, the first problem is to harmonize the 



PIECE WORK 95 

various operations. In most plants, espe- 
cially those that have grown gradually from 
small beginnings, it is usually possible for a 
capable man to do this in a manner that will 
increase efficiency, diminish the amount of 
supervision needed, and secure the co-opera- 
tion of the best men, if he makes a careful 
study of the work with that object in view. 

To do this it is often necessary to rear- 
range machinery in order to minimize trans- 
portation and bring together similar and al- 
lied operations. This should be done before 
a study is made of the detail operations, 
which, if possible, should be studied under 
the conditions that are to be permanent. 

In other words, the general problem of 
manufacture must first be divided into its 
grand divisions ; these grand divisions must 
then be divided and subdivided until the in- 
dividual operations may be further subdi- 
vided into details which can be studied sepa- 
rately. 

Analyzing a piece of work into its proper 
elements and determining the minimum time 
for each element is not work that can be done 
by an inexperienced clerk with a stop watch, 
but requires a man with a trained analytical 
mind who can concentrate his attention on a 



96 WOEK^ WAGES, AND PROFITS 

problem and learn all there is to be known 
about it. Having determined tbe minimum 
time in wbicli the work can be done, the 
problem of setting a reasonable task is still 
to be solved. If the work is simple and is to 
be repeated many times per day, and day 
after day, the task should be a difficult one 
for even the good workers at first, for with 
repetition they will acquire skill, and in a 
short time it will become easy. In snch work 
it will often pay to spend quite a long time 
training workers to do it efficiently. 

If, on the other hand, the operation is but 
seldom done, it may not pay to spend much 
time training workmen to do it with great 
efficiency. In this case we should not make 
the task too severe, but such as a good work- 
man can do without the preparation of spe- 
cial training. 

This studying of the elements of a piece of 
work and setting proper tasks or piece rates, 
though an important part of any proper sys- 
tem of management, is only a part. The 
broad problem which, includes all others is 
to develop a system that encourages the study 
of all operations and adequately rewards all 
who co-operate for their continued efficient 
performance. 



PIECE WORK 97 

As was said before, it is not the workman 
to whom we must look for increase in effi- 
ciency, but the manager. The policy of com- 
pensating the individual for efficiency is 
bound to cause increase of efficiency, and that 
of fixing compensation regardless of effi- 
ciency is just as sure to reduce it. The man- 
ager, and not the workman, is responsible 
for the policy. 

It is a well-recognized fact that the efficient 
man at high wages is much more profitable 
to his employer than the inefficient man at 
low wages, yet how many managers give any 
consideration to the subject of increasing 
efficiency ? Under the system of management 
in most general use the manager puts the 
solution of all problems concerning work- 
men on his superintendents, who in turn pass 
them on to their foremen. 

Is such a policy a system of management, 
or is it a system of shirking the responsibili- 
ties of management? Of course the man- 
ager cannot personally study all the opera- 
tions, and solve all the labor problems that 
may come up; but if he has the knowledge 
and ability he can gradually build up an or- 
ganization that will successfully study and 
solve them. 



98 avore:^ avageS;, And profits 

The demand for trained workmen is very 
extensive, but it too often spends itself in 
schemes for schools to carry out at their own 
expense, and the question immediately arises 
as to whether the schools, or, in other words, 
the State, should bear the expense of train- 
ing workmen. Under the old apprentice sys- 
tem each trade trained its own workmen. 
Under our factory system this method has 
been largely abandoned, and nothing has 
been developed to take its place. Is it not 
the duty of the factory to develop a substi- 
tute for a system its methods have made ob- 
solete? Is not the system of having a first- 
class workman study mechanical operations 
in detail and teach the younger man to per- 
form them in the best manner he can devise, 
and at the best speed he can show, far su- 
perior to the old method where the appren- 
tice might have an efficient teacher, but more 
often did not! 

Surely nobody will deny that such a sys- 
tem is to be preferred to the old apprentice 
system, and, if so, the only question that 
arises is, will it pay the manufacturer? 

Inasmuch as the efficient workman often 
does two or three times as much as the poor 
workman, and always does it better, and in- 



PIECE WOEK 99 

asmuch as tlie workman wlio does twice as 
mucli work cuts the general expenses per 
unit of output in half, there would seem to 
be no question that such a system of training 
would pay handsomely. This will be dis- 
cussed in detail in the subsequent chapters. 



TASK WOEK WITH A BONUS 



Chapter VI 

TASK WORK WITH A BO:^US 

TN the preceding chapters an attempt has 
-*• been made to show that present labor 
conditions — that is, labor nnions and em- 
ployers' associations— are a natural and al- 
most a necessary result of the present meth- 
ods of handling workmen. The horizontal 
wage, under which men in a certain class get 
a certain wage and under which it is prac- 
tically impossible for any individual to get 
much more than the average day, or piece- 
work, wage of the class, has its effect in 
causing the workmen of that class to com- 
bine to get the average wage of the class in- 
creased. 

It was also explained that as long as we 
classified workmen and paid those of one 
class substantially one wage, without greatly 
varying that wage according to efficiency, 
the efficient men, realizing that they could 
not get any more money than was paid to the 
average of their class, would continue to 
combine with the others in that class to have 
103 



104: WOEK, WAGES, AN"D PROFITS 

the class wage raised. This is what they 
have done in the past; and, if we read hu- 
man nature aright, this is what they will do 
in the future, until some means has been de- 
vised by which the efficient man can get 
proper compensation for his work. When 
his compensation is independent of what the 
inefficient man gets, he will not worry him- 
self greatly about combining with the ineffi- 
cient man. The employer recognizes that the 
efficient man is worth more to him than the 
inefficient man, but most employers do not 
know any scheme by which they can com- 
pensate the efficient man according to his 
deserts, and avoid trouble w^ith the ineffi- 
cient man. 

The object of this chapter is to show what 
we have accomplished both in the way of 
rewarding the efficient man, and of making 
the inefficient man efficient. 

In March, 1899, I became associated with 
the Bethlehem Steel Company to assist in 
putting into operation methods for increas- 
ing the efficiency of their labor. This work 
was being done by Mr. F. "W. Taylor, with 
whom I had been associated twelve years 
previously in the Midvale Steel Company, 
where the methods underlying Mr. Taylor's 



TASK WORK WITH A BONUS 105 

work originated, and where tliey are still in 
operation. 

One object tliat Mr. Taylor had in mind 
was to establish thronghont the plant a sys- 
tem of piece work based on a scientific stndy 
of what conld be done, and to make piece 
rates that should be permanent. The por- 
tion of the works that seemed to offer the 
greatest field was the main machine shop ; 
bnt before setting these piece rates it was 
necessary to make a great many changes. 
Machines in this shop had been located, not 
with reference to any particular system of 
management (because nobody had given the 
system of management any particular 
thought) but promiscuously, throughout the 
shop. 

In order to do work economically it was 
desirable to rearrange the machine tools in 
such a manner that a foreman, expert on one 
class of work, should be able to supervise 
that work. Accordingly the location of the 
machines was so changed as to place the 
large lathes in one group, the small lathes 
in another, the planers in another, etc. "While 
the machines were being moved they were 
respeeded to enable them to utilize to ad- 
vantage the improvements that had been 



106 WORK^ WAGES, AND PROFITS 

made in tool steel, Mr. Taylor at the same 
time making a large number of experiments* 
to determine the best shapes of tools and the 
best tool steel with which to do the work, 
which in this shop was very miscellaneous in 
character. Even when we got the shop re- 
arranged, much study still had to be done 
before we could know enough about the con- 
ditions to make permanent piece rates. 

The high degree of perfection demanded 
by Mr. Taylor took much time ; and the con- 
sequence was, that although slide rules for 
determining how to do m.achine work and in- 
struction cards for directing the workmen 
had been in use since 1899, the monthly out- 
put of the shop during the year from March 
1, 1900, to March 1, 1901, had been but little 
more than the monthly average for the five 
years preceding. 

Up to this time we had devoted ourselves 
to the study of what could be done, and had 
done but little to cause the workmen to co- 
operate with us. This record shows that we 
had not in any measurable degree secured 
their co-operation. In other words, we had 
much knowledge, but were unable to get any 
substantial benefit from it because the men 

*The result of these experiments was the development 
of the Taylor-White method of treating tool steel. 



TASK WORK WITH A BONUS 107 

would not help. Not being ready to intro- 
duce the differential piece-rate system, which 
was regarded as the ideal one for obtaining 
a maximum output, I felt that we should not 
wait for perfection, but should offer the 
workmen additional pay in some manner 
that would not interfere with the ultimate 
adoption of the differential* piece-rate sys- 
tem. Accordingly on March 11, 1901, I sug- 
gested that we pay a bonus of 50 cents to 
each workman who did in any day all the 
work called for on his instruction card. 
This was adopted at once, and Mr. E. P. 
Earle, the superintendent of the machine 
shop, suggested that we should also pay the 
gang boss (the man who supplied the work) 
or speed boss (foreman) a bonus each day 
for each of his men that earned his bonus. 
This was also approved, and both plans 
were ordered to be put into execution as 
promptly as possible. 

This bonus payment was begun at once, 
and on May 13 the assistant superintendent 

*The differential piece rate was devised by Mr. F. W. 
Taylor while with the Midvale Steel Co., to stimulate 
maximum production. It consisted of a high rate per 
piece if a definite large product per day was attained, 
and a lower piece price if the output was less than the 
amount set. The effect of the system was to cause a 
big increase in wages for attaining a definite degree of 
efficiency. 



108 WORK, WAGES, A^^D PEOriTS 

of tile macMne shop, Mr. E. J. Snyder, made 
tlie following report: 

Mr. E. P. Eaele. 

Snpt. of Macliine Shop 'No. 2. 
Dear Sir: 

I hand 3^011 herewith some notes on the results 
obtained by the introduction of the "bonus" plan for 
remunerating labor in No. 2 machine shop. (Here 
follow machine nnmbers and dates when they were 
started on this plan.) 

One of the best results after a short trial has been 
the moral effect upon the men. They have had it 
placed in their power to earn a very substantial in- 
crease in wages by a corresponding increase in their 
prodiTctive capacity, and this has given them the feel- 
ing that the company is quite willing to reward the 
increased effort. They display a willingness to work 
right up to their capacity, with the knowledge that 
they are not given impossibilities to perform. Tliis 
effect has been brought about by the good use of our 
excellent slide rules in the hands of a number of the 
most thoroughly practical men, who, when the results 
Avhich they demand have been declared impossible to 
obtain, have repeatedly gone out into the shop and 
themselves demonstrated that the time was ample, by 
doing the work well within the limits set. All this 
has inspired the confidence of the shop . hands, and 
the excellent instruction cards sent out are gradually 
evolving from laborers a most efficient lot of machine 
hands. . . . The percentage of errors in machin- 
ing has been very materially reduced, which is un- 
questionably due to the fact that in order to earn his 
bonus a man must utilize his brains and faculties to 
the fullest extent, and so has his attention closely 
fixed on the work before him, as every move must be 



TASK WORK WITH A BONUS 109 

made to count. He thus has no time for dreaming^ 
which was^ no donbt^, the cause of many errors. 

The condition of the machines is vastly improved. 
Most care has been taken to point out to the men 
that the best results can be obtained only by keeping 
their machines in good running condition, well-lubri- 
cated and cleaned. They have not been slow to 
realize thiS;, and cases of journals cutting fast are 
very rare, while before the introduction of the 
^^bonus" plan this was a very common occurrence. 
Breakdowns are also of a less frequent occurrence. 

The crane service lately has given us little trouble, 
and lack of crane service was formerly a constant 
excuse of the bosses and men for not being able to 
keep machines filled with work. The improvement 
in this case arose from the rule laid down that no 
exceptions or allowances would be made for delays 
due to this cause. 

It is only by the introduction of this ^^bonus'^ plan 
that we have had furnished the automatic incentive 
for men to work up to their capacity and to obtain 
from the machines the product which they are cap- 
able of turning out. It has lifted the hands of the 
speed bosses (foremen) and enabled them to act 
in the capacity for which those positions were created 
— ^that of instructors. 



These are some of the direct results obtained. In- 
directly it has eliminated the constant necessity for 
driving the men, and has enabled the shop manage- 
ment to divert some of its energy into perfecting the 
organization, which only will enable us to give a 
good account of the shop equipment. Much good has 
also resulted from putting the work through in lots, 
and keeping each machine as nearly as possible on the 
game kind of work. 



110 WORK;, WAGES, AND PROFITS 

It is also a pleasure to note in this connection the 
deep interest taken in the work by the men connected 
with it, and the fine co-operative spirit which pre- 
vails among all hands. 

This report was made only two months 
after the bonus system was started, now 
nearly nine years ago, and is particularly 
valuable as it emphasizes some of the fun- 
damental principles on which successful work 
of this character must be founded. We must 
secure the confidence and co-operation of the 
workman by assuring Mm equitable compen- 
sation. If we fail to do this, any results we 
may get will be of short duration and our 
work will finally come to naught. Many of 
the failures to get continuously the high effi- 
ciency which seemed easily possible, have 
been due to a disregard of the fact that the 
workman is entitled to a share in the bene- 
fits of increased efficiency, and in the long 
run will not co-operate unless he gets it. 

The attempt to drive the workman to in- 
creased efforts which benefit the employer 
alone, necessarily creates a force of opposi- 
tion which grows greater as it is carried far- 
ther. Finally, the force of opposition be- 
comes so great that further progress is im- 
possible and the system of management 



TASK WORK WITH A BONUS 111 

based on force breaks down. This is as it 
should be, if we are to progress from an era 
of force to one of equity, and to make ob- 
solete the doctrine that ^'they should take 
who have the power and they should keep 
who can." 

Continual failure to obtain our ends per- 
manently by the use of force, and success 
in obtaining them by co-operation, will ulti- 
mately show that the selfishness that prompts 
the use of force is unintelligent, and that the 
most intelligent selfishness is that which 
shares the benefits equitably among those 
helping to obtain them. 

In closing the discussion on a paper on 
training workmen, read before the Ameri- 
can Society of Mechanical Engineers, De- 
cember, 1908, I made the following state- 
ment: 



A system of management may be defined as a 
means of causing men to co-operate with each other 
for a common end. If this co-operation is main- 
tained by force, the system is in a state of unstable 
equilibrium, and will go to pieces if the strong 
hand is removed. Co-operation in which the bond 
is mutual interest in the success of work done by 
intelligent and honest methods produces a state of 
equilibrium which is stable and needs no outsid© 
support. 



112 WORK, WAGES, AND PROFITS 

In the paper itself tlie following statements 
are found: 

The general policy of the past has been to drive, 
but the era of force must give Avay to that of knowl- 
edge, and the policy of the future will be to teach 
and to lead, to the advantage of all concerned. 

It is too much to hope, however, that the methods 
about to be described will be adopted extensively in 
the near future; for the great majority of managers, 
whose success is based mainly on their personal abil- 
ity, will hesitate before adopting what seems to 
them the slower and less forceful policy of studying 
problems and training worlvmen; but should they 
do so, they will have absolutely no desire to return 
to their former methods. 

In some quarters I have been regarded as 
not making the most of opportunities because 
of adherence to this policy, but results in 
the long run have been so much greater and 
more stable than those obtained by the driv- 
ing method, that even the strongest advo- 
cates of force are beginning to recognize that 
in their desire to get great results qiiicldy 
they may fail to get them permanently. 

To go back, however, to the Bethlehem 
Steel Works, we note that the average 
monthly output of the shop from March 1, 
1900, to March 1, 1901, was 1,173,000 pounds ; 
and from March 1, 1901, to August 1, 1901, it 
was 2,069,000 pounds. The shop had 700 



TASK WORK WITH A BONUS 113 

men in it and we were paying on the bonus 
plan only about 80 workmen out of tbat en- 
tire 700. 

In September, 1901, tbe ownership of the 
works passed into the hands of Mr. Charles 
M. Schwab, and with this change came a 
change in management. Mr. Schwab had 
been brought up in a school where the drive 
method only was used, and he did not believe 
in any other. Mr. Taylor had already left 
the works, and the services of the writer 
and all others that had been prominent in 
installing the new methods were shortly dis- 
pensed with. 

An unintelligent selfishness on the part of 
the management soon caused them to cease 
paying any bonus to the foreman. Other 
changes gradually followed, and, although at- 
tempts were made to retain some of the me- 
chanical features of our methods, in a few 
years the essential principles of this work 
were practically eliminated and the efficiency 
of the shop ran down to such an extent as 
to become notorious. A complete return to 
the drive method after repudiating these 
principles, has produced a series of labor 
troubles, which, at this writing, have culmi- 
nated in closing down the whole plant. 



114 WORK;, WAGES;, AND PROFITS 

Contrast this with over thirty years' free- 
dom from labor troubles enjoyed by the Mid- 
vale Steel Company, ivhere long ago these 
methods had their beginning. 

The plan as started at Bethlehem of pay- 
ing a fixed bonns for performing the task 
had one element of weakness, namely, that 
after the men had earned their bonus there 
was no further incentive to them. It was 
some time before I devised a satisfactory 
method for adding such an incentive, which 
was finally accomplished by paying the work- 
man for the time allowed plus a percentage 
of that time. 

For instance, if the time allowed for a task 
is three hours, the workman who performs 
it in three hours or less is given four hours' 
pay. He thus has an incentive to do as much 
work as possible. If the workman fails to 
perform the task within the time limit he gets 
his day rate. The time allowed plus the 
bonus is the equivalent of a piece-rate ; hence 
we have piece work for the skilled and day 
work for the unskilled. 

One other feature of this work at Bethle- 
hem had a most important effect on the re- 
sult — ^namely, that in addition to the bonus 
paid the foreman for each man under him 



TASK WORK WITH A BONUS 115 

wlio made bonus, a further bonus was paid 
if all made bonus. For instance, a foreman 
having ten men under him would get 10 cents 
each, or 90 cents total, if nine of his men 
made bonus ; but 15 cents each, or $1.50 total, 
if all ten made bonus. The additional 60 
cents for bringing the inferior workmen up 
to the standard made him devote his ener- 
gies to those men who most needed them. 

This is the first recorded attempt to make 
it to the financial interest of the foreman to 
teach the individual worker, and the import- 
ance of it cannot he over-estimated, for it 
changes the foreman from a driver of Ms 
men to their friend and helper. 

Under former conditions, the foreman hes- 
itated to teach the workman for fear the lat- 
ter might learn as much as he knew and pos- 
sibly get his job. Under the new conditions, 
the man who knows is paid for teaching 
others as much as he knows, and the others 
are paid a bonus for learning and doing what 
they are taught. It is this feature of the task 
and bonus system that has enabled us not 
only to obtain, but to maintain permanently, 
such satisfactory results. The expert work- 
man who becomes a good teacher soon makes 
his services valuable, for, by his assistance, 



116 WOEK^ WAGES, AND PEOFITS 

we can often make the average efficiency of 
the shop even greater than his best efficiency 
IV as before tve began to study the question of 
efficiency. He learns to remove obstacles 
which stood in his luay when he was a simple 
workman^ and often becomes an expert also 
not only at removing these obstacles, but at 
developing better methods to avoid them. 

Sucli, in brief, is tlie history of the devel- 
opment of the task and bonns system, which, 
starting as a substitute for differential piece 
work, gradually supjolanted it, differing only 
by the fact that the worker who failed to 
earn the high rate got his day's pay instead 
of a lower piece rate, thus allowing the in- 
efficient workman a chance to earn a living 
while learning to become efficient. This ef- 
fort to help the poor workman by giving him 
a living wage and an instructor, enables us 
to utilize many bright young men who either 
did not have a chance to learn a trade, or did 
not appreciate it when they had it. This is 
an exceedingly large class, and one that we 
find everywhere. 

To review again the elements on which this 
system is founded, we note : 

1. — A scientific investigation in detail of 
each piece of work, and the determination of 



TASK WORK WITH A BONUS ,117 

the best method and the shortest time in 
which the work can be done. 

2. — A teacher capable of teaching the best 
method and shortest time. 

3. — Eeward for both teacher and pupil 
when the latter is snccessfnl. 

Are not these elements sure to make for 
success ! The fact that we have been able to 
develop promptly workmen who could satis- 
factorily perform any ordinary task is the 
best answer. This method of providing 
workers for the semi-skilled jobs of a factory 
has been so successful that we are led to ask 
whether our method is not the basis on which 
to found a system of instruction and training 
for apprentices and workmen in general. 

In a following chapter we shall show in de- 
tail what has been accomplished, and give 
data which prove that money invested in es- 
tablishing a scheme of management and 
training on these lines yields a very large re- 
turn. One of the best results of this work is 
that the trained workmen almost always hold 
on to their jobs, and the few that leave soon 
come back. Under our methods workmen 
take pride in being efficient. 



THE TASK IDEA' 



Chapter VII 
THE TASK IDEA 

T TNDEELYINa the theory and practice of 
^ ^'Task Work with a Bonus'' is an im- 
portant principle — a concept altogether dif- 
ferent in kind from that which actuates the 
*^ drive" method, or the policy of urging men 
to mere strenuous toil, without any well- 
measured standard of how much work a man 
should reasonably do under the conditions of 
the case. This principle is the Task Idea. 
.What are its elements and influences? 

In studying a problem it is best to consider 
first the simplest form in which that problem 
presents itself, and one if possible in which 
the issues are perfectly clear to all. A 
good example for our purpose is to study 
the methods by which a child is taught 
to perform a simple operation. The in- 
variable method is to explain to the child 
as clearly as possible what is wanted, and 
then to set a task for it to accomplish. It 
may be noted that the accomplishment of the 
task is rendered much easier for both the 
121 



122 WOEK^ WAGES, AND PROFITS 

cMld and the parent, if a suitable reward is 
offered for the proper performance. As a 
matter of fact, setting tasks and rewarding 
performance is the standard method of 
teaching and training children. The school- 
master invariably sets tasks, and, while they 
are not always performed as well as he 
wishes, he gets far more done than if he had 
not set them. The college professor finds 
the task his most effective instrument in get- 
ting work out of his students, and when we 
in our personal work have something strenu- 
ous or disagreeable to accomplish, it is not 
infrequently that we utilize the same idea to 
help ourselves, and it does help us. 

The inducement to perform the task is al- 
ways some benefit or reward. It may not al- 
ways be so immediate as the lump of sugar 
the child gets, but the work is still done for 
some reward, immediate or prospective. 
Further, it is a well-acknowledged fact that 
to work at a task which we recognize as 
being within our power to accomplish with- 
out overexerting ourselves, is less tiring and 
far more pleasant than to work along at the 
same rate with no special goal ahead. 

It is simply the difference between work- 
ing with an object, and without one. The 



THE TASK IDEA 123 

hunter who enjoys following the trail of the 
moose, day after day, through snow and bit- 
ter cold weather, would find the same travel- 
ing very disagreeable except for the task he 
has set himself. To the uninitiated, golf 
seems a very inane sort of game, but its de- 
votees work at it with tremendous energy 
just for the satisfaction of reducing their 
score a few strokes. As they become more 
proficient, they become more enthusiastic; 
for, having performed one task, there is al- 
ways one just a little harder to work at. A 
consideration of this subject will convince us 
that in the vast majority of people there 
readily springs up the desire to do some- 
thing specific if the opportunity offers, and 
if an adequate reward can be obtained for 
doing it. 

A NATUEAL METHOD 

The idea of setting for each worker a task 
with a tonus for its accomplishment seems 
thus to be in accord with human nature, and 
hence the proper foundation of a system of 
management. Our problem, then, is to find 
out how to set a proper task and what the 
reward should be for its accomplishment. 

The ideal industrial community would be 



124 WORK^ WAGES^ AND PROFITS 

one in whicli every member has Ms proper 
daily task and receives a corresponding re- 
ward. Such a community would represent 
the condition of which Kipling says : 

"They sliall work for an age at a sitting and never 
be tired at all/' 

This is what Scientific Management in its 
best development aims to accomplish, for it 
aims to assign to each, from the highest to 
the lowest, a definite task each day, and to 
secure to every individual such a reward as 
will make his task not only acceptable, but 
agreeable and pleasant. Whatever we do 
must be in accord with human nature. We 
cannot drive people; we must direct their 
development. 

The greatest obstacles to the introduction 
of this method in the past have not been the 
workmen, but the foremen and others in au- 
thority. Those offering most objection have, 
as a rule, either not understood what was 
being done, or have felt their inability to 
hold their jobs if they were asked to perform 
them in accordance with the high standards 
set. Frequently, the higher they are in au- 
thority the less they can see that they should 
have a task set for them. Such a system 



THE TASK IDEA 125 

bears hardest on those who hold their jobs 
by pull or hluff, and it is from them that we 
should expect the greatest opposition. In 
this we are not disappointed. In fact, there 
is only one class that opposes us more 
strongly, and that is the class which is using 
official position for private gain. Such peo- 
ple will often commit serious crimes in an 
attempt to prevent the exposure of their ir- 
regularities, and no concern, therefore, 
should undertake the installation of these 
methods, unless with the avowed purpose of 
eliminating all kinds of graft and special 
privileges. 

SCHEDULES AS TASKS 

The task idea is really so common that we 
do not recognize it. Every railroad schedule 
consists of a series of tasks, and in the manu- 
facture of such articles as sewing machines, 
typewriters, and locomotives, the task idea 
is illustrated by the schedules according to 
which the various parts are started on their 
way through the different departments, and 
day by day make such progress as will bring 
them to the erecting shop at the proper time 
to be incorporated into the finished machine 
without delay. 



126 WORK^ WAGES^ AND PROFITS 

In tlie case of locomotives, in particular, 
the task idea is specifically illustrated by the 
dates of shipment set, often months ahead, 
which are lived up to in a very remarkable 
manner. When the shipping date of a loco- 
motive has been set, there has also been set 
the time when every piece must start on its 
course through the shops to arrive at the 
appointed time in the erecting shop. Inas- 
much as this work has been done over and 
over again, all the principal men in the 
works know by heart the schedules of all the 
parts they are concerned with, and what 
their tasks are. 

Wherever the work is of one general char- 
acter, this condition exists, for each foreman, 
and in many cases the various workmen, soon 
learn the proper routes and time- schedules of 
the parts they are concerned with. 

The grand task of shipping at a predeter- 
mined date, then, consists of the sum of those 
detail tasks, each of which must be per- 
formed properly and in the proper sequence 
if the shipping date is to be lived up to. 

SCHEDULING MISCELLANEOUS WORK 

Where the work is miscellaneous in char- 
acter, however, the task of having each part 



THE TASK IDEA 127 

go through the proper sequence of operations 
and arrive at the erecting shop in the order 
wanted is not so easy. As a matter of fact, 
it is my feeling that the inability to get mis- 
cellaneous work through a shop on time be- 
cause of lack of proper schedules, and the 
delays caused thereby, are often the source 
of as much expense as inefficient work on the 
part of the operative. 

In a small shop one capable man can often 
so plan miscellaneous work, and keep account 
of it in his head, that but little expense is 
incurred from delays or interferences; but 
in the large shops of today, and especially 
in plants consisting of several shops, such a 
thing is quite impossible ; and the larger the 
shop or plant the greater the expense that 
arises from this source. This, then, is the 
greatest and most important task to be per- 
formed in any works, and it is one for which 
the management is solely responsible. To go 
into details of how such a task is performed 
would be impossible in the short time at my 
disposal. Suffice it to say, however, that, 
when a start has been made and each fore- 
man receives each day a list of jobs to be 
done that day, the general efficiency of the 
works is much increased, though nothing 



128 WORK;, WAGES^ AND PROFITS 

whatever lias been done to increase the effi- 
ciency of the individnal workman. Although 
such an order of work is of great assistance 
to the foreman, its usefulness increases rap- 
idly as the work is so planned as to avoid in- 
terferences and to have all materials and 
appliances ready for the workman in ad- 
vance. With this result the efficiency of the 
individual increases, and, unless his ineffi- 
ciency is very flagrant, it is far better to 
solve this general problem first and to take 
up the efficiency of the workman later, except 
to the extent of keeping a dail^ record of 
his work; for when the large problem is 
solved, every advance made by the individ- 
ual counts for all it is worth, which is not 
always the case when work is done in the 
wrong sequence or by an inferior method. 

What I have said has often proved itself 
of value. Anybody who gives the subject 
thought will readily recognize the importance 
of it. I had a case a few years ago where 
there was a very good foreman of a certain 
shop — I say he was good because he intended 
to do the right thing and he was bright and 
he knew how to do the work — ^who neverthe- 
less had one failing, a very bad memory. He 
would promise anything and never perform 



THE TASK IDEA 129 

it. It was not because lie did not want to do 
it ; he would always forget. He honestly for- 
got. And when we gave him a list of the 
work in the order in which it was wanted, 
and presented him each day a list of the 
work he was to do next, he was perfectly 
delighted. 

I have had many similar cases and have 
always been able in this way to increase the 
efficiency of the foreman and of the work- 
men. In one case I was told that certain 
foremen in a large shop were useless; there 
was one in particular whom they would have 
to get rid of. Well, we did not discuss that 
question. We found that he was always be- 
hind in his work because he was always doing 
the wrong thing first. We went to work to 
straighten out what he should do and gave 
him each day a list of the work he was to do 
that day. In a short time he caught up with 
his work, and some months later he came to 
the superintendent of the shop and said, 
*' There is something wrong in this shop.'' 
The superintendent asked, ^^What is the 
matter?'' ^*I don't know," said the fore- 
man; *^but there is something wrong in this 
shop." *^Well, what is it, if it is wrong?" 
^* Well, "the foreman replied, ^^ nobody has 



130 WORK^ WAGES^ AND PROFITS 

been cliasing me about my work for three 
days." That happened several years ago, 
and the man is still there as foreman. 

Having solved our large problem of sched- 
nling each part through the works, and hav- 
ing devised means for knowing each day 
whether our schedules are lived up to or not, 
we come to what most people consider the 
real problem, that of setting a task for the 
workman. 

Many shops have a very nice schedule sys- 
tem; they plan their work beautifully — at 
least, it looks very pretty on paper ; but they 
have no means of finding out whether those 
schedules are lived up to or not. Usually 
they are not. I have been through shops 
where the superintendent or manager told 
me he had a fine system of management, and, 
having described his whole system to me, 
turned me over to a subordinate to take me 
around and see how it was working. It has 
been very seldom that I have found the sys- 
tem working the way the superintendent said 
it was. He had planned it and had given his 
orders, but when I got out into the shop and 
asked questions, I found that the foreman 
and the people charged with carrying out 
this system said, *VWe found we couldn't do 



THE TASK IDEA 131 

it just that way and we have done it this 
way. ' ' One dear old man whom I knew very 
well was very proud of his shop system. He 
spent quite a time one day showing it to me, 
and then turned me over to one of his sub- 
ordinates to be shown the details of any- 
thing I wanted to see. There was absolutely 
nothing going as he said it was going. The 
force had not argued with him ; they had just 
gone on and done things in their own way. 
He had this beautiful system all on paper. 
It looked to me pretty complicated, but he 
thought it was fine. Everybody was going 
on just the same as before, and he was ig- 
norant of the fact. They never brought it 
up to him; they got things out the best way 
they could, made whatever excuses were 
necessary, and got through. 

With regard to the subject of tasks it may 
be said that it is only in those cases where 
the number of routes is small and the se- 
quence of operations fixed, that proper tasks 
can be set for the workman before the solu- 
tion of the general problem. I have been 
working at one plant for a year and a half 
where they had a pretty good system of man- 
agement, and we have not set a task yet. We 
have been straightening out their routes. 



132 WORK^ WAGES^ AND PROFITS 

We have been fixing it so that the work 
should go through the shop in the order 
wanted and not by the snap judgment of 
some individual. As soon as we have got 
into the various rooms — in many cases rooms 
which were crowded and where work was 
stacked all round the room — and begun to 
plan the work so as to have it done in proper 
sequence and without delay, congestion has 
disappeared. That has happened in so many 
cases that it cannot be attributed to acci- 
dent. In one case the shop was filled with 
small boxes of little pieces that were in pro- 
cess. There were a great many of those 
boxes. I said, *^The first thing, gentlemen, 
is to get some racks made and classify these 
boxes according to the operation which is 
next to be performed on the pieces.'' They 
saw they had a great many boxes there and 
they built a corresponding number of racks. 
When they got this work classified and began 
to lay it out, they found they had many more 
racks than they needed. The work kept mov- 
ing instead of standing there. 

In many factories the amount of work in 
process, moving in a desultory way through 
the factory, is two or three times as great 
as there is any necessity for, if its course 



THE TASK IDEA 133 

were properly planned. It not only takes up 
factory space, but it ties up a large amount 
of capital where work is not properly 
planned. The ordinary stock-keeper or fore- 
man always wants to give himself about two 
or three times as much time as is needed to 
get the work done. He always expects that 
when a man promises to give him something 
next Monday, it will be Monday week or 
Monday two weeks before he will get it. And 
that is true if the planning of that work is 
left to a series of foremen. There are many 
reasons why that has to be so. It is imprac- 
ticable to do it in any other way. If, how- 
ever, all that planning is done from one cen- 
tral headquarters, and each man knows how 
much he has to accomplish, and it is put up 
to him in such a way that he can accomplish 
it, it gets through pretty regularly. 

To send a clerk into a shop to time work- 
men with a stop-watch and set rates, or tasks, 
naturally arouses the opposition of the work- 
men; and while no doubt it has been possible 
in many cases to get more work by so doing, 
no doubt, also, its effect on the industrial 
conditions of the country at large has been 
decidedly detrimental. It creates opposition, 
and justly. 



134 WORK^ WAGES, AND PEOFITS 

"Working at tasks is not a hardship, but a 
pleasure, if they are properly set and ade- 
quately rewarded. Before task-setting can 
be carried on satisfactorily, the workmen 
must be convinced that we are not approach- 
ing them with a scheme for driving, but 
with one by which they will be benefited. 
They must be satisfied, too, that the man 
who is going to study their work knows what 
he is doing. He should not be a clerk picked 
up at random and given a stop-watch; he 
should be a man who knows what the prob- 
lem is and how to solve it. 

PEEPAEATIOIT FOR TASK-SETTING 

Among the steps to be taken before setting 
a task are : to get all machines and appliances 
in proper order, to establish a proper tool- 
room where suitable tools can be obtained for 
work, to arrange to supply the workmen with 
material in the order wanted, to plan work 
so that it is very seldom that one job shall 
be stopped to make way for another. In 
other words, before we begin the problem of 
task-setting for the individual, we should 
arrange conditions so that he can work to 
the best advantage, with proper ventilation 
and a comfortable temperature. These con- 



THE TASK IDEA 135 

ditions alone will materially increase output, 
for petty annoyance of any kind reduces 
efficiency. If the work requires mechan- 
ical skill or ability, the problem should be 
studied by the most capable mechanic avail- 
able, and specific instructions given as to 
the best way to do the work and the time re- 
quired to do it. If necessary (and it usually 
is) the investigator and task-setter should 
now turn instructor and show the workmen 
how to do the work, and the task should be 
such that a good workman can readily learn 
to perform it. If the task is set in this man- 
ner by a man in whose ability and honesty 
the workman has confidence, I have but little 
difficulty getting the task-work started, pro- 
vided a proper bonus is offered. 

This leads to the question. What is a 
proper bonus"? The reply is that it is such 
a bonus as will make the workman feel that 
he is fully compensated for any extra exer- 
tion he puts forth. 

Judging from this point of view, it is evi- 
dent that the bonus depends upon the sever- 
ity of the work. It varies, as a rule, from 
20 per cent to 50 per cent of the day rate. 
Task work does not necessarily mean more 
severe work, but it does mean more continu- 



136 WOEK^ WAGES, AXD PROFITS 

ons work, and work under more favorable 
conditions, which always produces greater 
efficiency. 

The attempt to set a task so severe that 
very few people can be taught to perform it 
is of no advantage from any standpoint, for 
few will continue to strive for a reward 
which they cannot reach. I have seen em- 
ployers who were much surprised that they 
did not get an increased output where they 
had set a reward for it — surprised that the 
reward was being earned by one or two 
only out of fifty or sixty. When a workman 
has made up his mind that the reward is 
beyond him, it has no eif ect. 

PEEFOEMING THE TASKS 

Having set a task, the responsibility for 
the performance does not rest upon the work- 
man alone, but must be shared by the in- 
structor, who must see that the conditions 
under which the task was set are maintained. 
That is an essential difference between task 
work with bonus and the ordinary form of 
piece work. The ordinary form of piece 
work is to fix a piece rate, and then let any- 
body do it, if he can; if he cannot, he gets 
out. We believe that it is our duty to show 



THE TASK IDEA 137 

the man how to do it, and to do whatever we 
can to help him perform his task. To com- 
plete the scheme, therefore, every case of lost 
bonus must be investigated and the reason 
determined. Such investigations, when the 
case is that of a man who has learned the 
work, usually lead to the discovery of 
slightly defective material, imperfect tools, 
machine out of order, or any one of a large 
number of things that might hamper the out- 
put considerably, but which would not be 
noticed unless a special search was made for 
them. Thus, the setting of a proper task for 
a workman also imposes obligations on, or 
sets tasks for, the management, with the in- 
variable result of a better and cheaper 
product. 

TASK WOKK IN A MACHINE SHOP 

The setting of machine-shop tasks is to- 
day quite different from what it was ten 
years ago. At that time machine operations 
took a relatively long time, and the time be- 
tween operations was of much less impor- 
tance. Today, when machine operations are, 
as a rule, three times as fast, the time of 
changing jobs has become three times as im- 
portant, and to plan our work so that there 



138 WORK^ WAGES^ AWD PROFITS 

will be no time lost in going from one job to 
another lias become a far greater factor. 
For each macMne-tool operative today, there 
has to be planned nearly three times as much 
work as formerly, and necessarily the super- 
vising force must be much greater. It is this 
increase in machine-tool capacity which has 
induced me to lay emphasis on the general 
scheduling of work, so that no more time than 
necessary shall be taken in changing jobs. 

The ratio between the number of men actu- 
ally engaged on mechanical work and those 
engaged in supervising or preparing work 
must necessarily be quite different from what 
it was before the advent of high-speed steel 
and methods of instruction and task setting. 

Task setting in every kind of shop is simi- 
lar, and although we do not have high-speed 
steel to reduce time in non-metal-working 
shops, we have, in many cases, something 
similar, the benefit of which is never fully 
realized until a proper and detailed study is 
made of the possibilities. 

I could give numerous illustrations of this. 
For instance, in the bleaching of cloth there 
are several processes, one of which is to sub- 
ject the cloth to the action of an acid. I 
found a variety of opinion in the plant in 



THE TASK IDEA 139 

which I first worked as to how long the cloth 
should be subjected to this treatment. They 
told me that they thought an hour was neces- 
sary. By watching their performances, I 
found that, while the man who told me that 
an hour was necessary usually subjected his 
cloth to the action of the acid for an hour, he 
sometimes allowed it to stay in the acid for 
several hours and sometimes only five min- 
utes. That, of course, opened a field for in- 
vestigation. He also told me how strong the 
acid should be, and insisted that he always 
kept it at that strength. We secured samples 
of his solution at different times and found 
that the strength varied from about 1 per 
cent to 7 per cent. That also opened up a 
line of study. We f oimd but little difference 
between cloth which had been acted upon five 
minutes and that which had been acted upon 
for an hour. As a result of our studies, we 
found the strength of acid needed and the 
time the cloth should remain subjected to it. 
It had been the practice to pile the cloth in 
a series of piles, and when it had remained 
long enough in these piles, to sew the ends 
together again and to pull it through the 
subsequent solutions. This method necessi- 
tated the sewing of the top of the second pile 



140 WOEK, WAGES, AND PROEITS 

to the bottom of the first. As this process 
was usually repeated several times in the 
bleaching, it is easily seen that the pieces of 
cloth naturally became pretty thoroughly 
'* shuffled" by the time the bleaching was 
completed. If the rope contained several 
kinds of goods, as was usually the case, the 
kinds were often so thoroughly mixed that 
they could not be gathered together again, 
except with much care and labor. The re- 
sult was that people frequently did not get 
all of the goods that they sent to the bleach- 
ery, but they got somebody's else, which 
were sometimes as good, and sometimes not. 
The discovery that those goods could be 
treated in a few minutes enabled us to make 
a remarkable change in the work and elim- 
inate a great deal of labor, besides keeping 
all the goods in exactly the order they went 
in. "We devised a machine which automatic- 
ally turns upward the leading end of a pile 
of goods formed in it. From this leading end 
the goods are pulled oif at exactly the same 
speed as that at which they are added to the 
pile. Thus all goods remain in the pile ex- 
actly the same length of time and are 
treated exactly alike, with the result of a 
uniformity of bleach before unattainable. 



THE TASK IDEA 141 

The lengtli of time the goods remain in 
the pile is governed by the judgment of the 
bleacher and is limited by the size of the 
machine. Several machines may be placed 
in series if it is desired to have the time very 
long. 

By means of this machine it has been pos- 
sible to bleach a number of small lots of 
different kinds of cloth together, yet to keep 
each lot intact, and to deliver to the finisher 
goods so uniform that he can feel sure that 
like treatment will produce like results. He 
is thus able to mix his starch according to 
his formula and be sure of his result. 

This one thing has had as much influence 
on the cotton-finishing industry as improved 
tool steel has had on the machine-shop indus- 
try. I say it has had — it will have, when it is 
extended to the degree to which it will ulti- 
mately be extended. The development is 
proceeding and it is being gradually extended 
throughout the country. 

This suggests that, in a non-metal-work- 
ing industry, there is nearly always some- 
thing in which improvement can be made, 
just as improvement has been made in the 
metal-working industry by high-speed tool 
steel. 



142 WORK^ WAGES^ AND PROFITS 

We have found that if work is properly 
planned, so that unnecessary delays do not 
occur and the workmen are provided with 
proper implements to enable them to per- 
form their tasks in the best manner we can 
devise, they can, as a rule, wherever the 
amount of work done depends upon physical 
exertion, do an average of three times as 
much as they did on day work, before plan- 
ning and task setting were begun, and feel 
no more tired at night. 

MAINTAIKIiq^G PKOPEE CONDITIONS 

While the setting of tasks under the proper 
conditions and in the proper spirit, accom- 
panied by a suitable reward for accomplish- 
ment, is of great advantage, it is essential 
that the conditions under which the tasks 
have been set should be maintained perma- 
nently. Failure to maintain these conditions 
will work hardship on the workman and will 
make it impossible many times for him to 
perform his task. No one, therefore, should 
undertake the introduction of task work, un- 
less he is prepared to maintain the condi- 
tions of his shop at a high standard; other- 
wise dissatisfaction is sure to spring up. 

The sum of the tasks which can be per- 



THE TASK IDEA 143 

formed by the individuals of the shop is the 
shop task, and the sum of the tasks of the 
shops is the factory task. Every foreman 
who can succeed in the accomplishment of 
his shop task should be properly rewarded. 
In such a scheme as this the foreman and the 
workmen are brought together by mutual 
interest, and there develops a spirit of co- 
operation. Under this scheme also it is 
perfectly evident that there will be a decided 
increase in profits. 

SUMMAEY 

A task has a psychological effect which is 
very striking. Eailroad schedules are tasks. 
Miscellaneous work is done badly and uneco- 
nomically because it is usually done without 
scheduling or task-setting. Tasks should 
not be set until we have arranged to main- 
tain permanently the conditions necessary 
for the performance of the task. The set- 
ting of a proper task for workmen neces- 
sarily sets a task for and imposes obligations 
upon the management. The setting of 
proper tasks in a machine shop today im- 
poses upon the management more strenuous 
tasks than it did before the advent of high- 
speed tool steel. 



TKAINING WOEKMEN IN HABITS OF 
INDUSTEY AND CO-OPEEATION 



Chapter VIII 

TRAININa WORKMEN m HABITS OF IN- 
DUSTEY A^B CO-OPERATIOX 

^~r^HE widespread interest in the training of 
-*■ workmen whicli has been so marked for 
several years is due to the evident need for 
better methods of training than those now 
generally in vogne. The one point in which 
these methods as a class seem to be lacking 
is that they do not lay enough stress on the 
fact that workmen must have industry as well 
as knowledge and skill. 

Habits of industry are far more valuable 
than any kind of knowledge or skill, for with 
such habits as a basis, the problem of acquir- 
ing knowledge and skill is much simplified. 
Without industry, knowledge and skill are of 
little value, and sometimes a great detriment. 
If workmen are systematically trained in 
habits of industry, it has been found possible 
not only to train many of them to be efficient 
in whatever capacity they are needed, but to 
develop an effective system of co-operation 
147 



148 WORK;, WAGES;, AND PROFITS 

between workmen and foremen. This is not 
a theory, but the record of a fact. 

It is too mncb to hope, however, that the 
methods here described will be adopted ex- 
tensively in the near future, for the great 
majority of managers, whose success is based 
mainly on their personal ability, will hesitate 
before adopting what seems to them the 
slower and less forceful policy of studying 
problems and training workmen; but should 
they do so they will have absolutely no de- 
sire to return to their former methods. 

The general policy of the past has been to 
drive ; but the era of force must give way to 
that of knowledge, and the policy of the fu- 
ture will be to teach and to lead, to the ad- 
vantage of all concerned. The vision of work- 
men, in general, eager to co-operate in car- 
rying out the results of scientific investiga- 
tions must be dismissed as a dream of the 
millennium, but results so far accomplished 
indicate that nothing will do more to bring 
about that millennium than training work- 
men in habits of industry and co-operation. 
A study of the principles on which such train- 
ing has been successfully established will con- 
vince the most skeptical that if they are car- 
ried out the results must follow. An outline 



TRAILING WORKMEN" TO INDUSTRY 149 

of these principles was originally submitted 
to the American Society of Mechanical En- 
gineers in a paper entitled ^'A Bonus System 
of Eewarding Labor.'' 

Under this system* each man has his work 
assigned to him in the form of a task to be 
done by a prescribed method with definite 
appliances and to be completed within a cer- 
tain time. The task is based on a detailed in- 
vestigation by a trained expert of the best 
methods of doing the work, and the task 
setter, or his assistant, acts as an instructor 
to teach the workmen to do the work in the 
manner and time specified. If the work is 
done within the time allowed by the expert, 
and is up to the standard for quality, the 
workman receives extra compensation in ad- 
dition to his day's pay. If it is not done in 
the time set, or is not up to the standard for 
quality, the workman receives his day's pay 
only. 

This system, in connection with the other 
work of Mr. F. W. Taylor, greatly increased 
the output and reduced the cost of the work 

*A Bonus System of Rewarding Labor, December, 
1901, a system of task work with a bonus which had 
recently been introduced by the writer into the large 
machine shop of the Bethlehem Steel Company, as a 
part of the system of management, being introduced 
into their works by Mr. F. W. Taylor. 



150 WOEK, WAGES, AND PROFITS 

in the large macMne shop of the Bethlehem 
Steel Company. 

In the closing remarks on the above paper, 
I emphasized the valne of the system as a 
means of training workmen, and the late Dr. 
Eobert H. Thnrston, in his discnssion of it, 
was so optimistic as to the results it wonld 
produce on ^^ workmen and foremen and em- 
ployer alike'' that I felt that my enthusiasm 
over a new and promising method had car- 
ried me, perhaps, a little too far. Eesults 
have fully justified Dr. Thurston's predic- 
tions, however, for today the method has 
been developed as a practical system of edu- 
cation and training for all, from the highest 
to the lowest. The fact, so repeatedly em- 
phasized by Mr. Taylor, that tasks should he 
set only as the result of a scientific investiga- 
tion, has proven of an educational value 
hardly to be over-estimated, for the scientific 
investigation of a process that has been de- 
veloped without the assistance of science al- 
most always reveals inconsistencies which it 
is possible to eliminate, thus perfecting the 
process, and, at the same time, reducing its 
cost. 

It is this scientific investigation that points 
to improvement in methods and educates 



TRAINING WORKMEN" TO INDUSTRY 151 

owners and managers, bnt the average work- 
man is interested only in Hs daily wage and 
has no special desire to learn improved 
methods. The results of our investigations 
are of little practical value, therefore, unless 
we can first teach our workmen how to use 
them, and then can induce them to do as they 
are taught. 

PKACTICAL APPLICATION". 

For this purpose an instructor, a task, and 
a bonus have been found most useful. People 
as a rule prefer to work at the speed and in 
the manner to which they have been accus- 
tomed, but are usually willing to work at any 
reasonable speed and in any reasonable man- 
ner, if sufficient indjacement is offered for so 
doing, and if they are so trained as to be able 
to earn the reward. In carrying out this 
plan we try to find men who are already 
skilled and able to perform the task set. It 
frequently happens, however, that the num- 
ber of such men is insufficient and it takes 
time to train the unskilled to a proper de- 
gree of efficiency; but with a bonus as an in- 
centive, and a proper instructor, a very fair 
proportion of the unskilled finally succeed 
in performing a task that was at first entirely 
beyond them. 



152 WORK, WAGES, AKD PROFITS 

Unskilled workmen, who under tliese con- 
ditions have become skilled in one kind of 
work, readily learn another, and soon begin 
to realize that they can, in a measure, at 
least, make up for their loss in not having 
learned a trade. As they become more skilled, 
they form better habits of work, lose less 
time and become more reliable. Their health 
improves, and the improvement in their gen- 
eral appearance is very marked. This im- 
provement in health seems to be due to a 
more regular and active life, combined with 
a greater interest in their work; for it is a 
well-known fact that ivorh in tvliicli ive are in- 
terested and which holds our attention tuith- 
out any effort on our part, tires us much less 
than that ice have to force ourselves to do. 
The task with a reward for its accomplish- 
ment produces this interest and holds the at- 
tention, with the invariable results of more 
work, better work, and better satisfied 
workers. 

The ^'Task and Bonus" method of train- 
ing not only furnishes the workmen with the 
required knowledge, but by offering an in- 
ducement to utilize that knowledge properly, 
trains him in proper habits of work. 



TRAINING WORKMEN TO INDUSTRY 153 

HABITS OF WOKK. 

In all work both quantity and quality mnst 
be considered, and onr task method demands 
a maximum quantity, all of which mnst be np 
to the standard for quality. Workmen trained 
under this method acquire the habit of doing 
a large amount of work well, and disprove 
the oft-repeated fallacy that good work must 
be done slowly. As a matter of fact, our 
quickest workers almost always do the best 
work when following instructions. We set 
great store by the habit of working quickly, 
for no matter how much skill a workman may 
have, he will not attain the best success with- 
out quickness. 

Habits of ivork in a mechanic are compar- 
able with habits of thought in an engineer, 
and our industrial schools should make 
proper habits of work the basis on which to 
build their training in manual dexterity. The 
engineering school does not make engineers, 
but tries to furnish its graduates with an 
equipment that will enable them to utilize 
readily and rapidly their own experience and 
that of others. In the same manner, indus- 
trial training schools should equip their grad- 
uates with habits of industry that will make 



154 WORK, WAGES^ AND PROFITS 

them, as mechanics, capable and willing to 
do a large amount of good work. As I see it, 
one of the most valuable assets that the grad- 
uate of a technical college or an industrial 
school can have is the habit of doing promptly 
and to the best of his ability the tvork set be- 
fore him. With this habit and reasonable in- 
telligence he can make good progress. This 
habit is one of the first results of the ^ ' Task 
and Bonus" system, for it is a noticeable 
fact that task workers form habits of indus- 
try which they maintain even when on day's 
work with no bonus in sight. 

In all schemes for technical or industrial 
education or training that I have seen, em- 
phasis has been laid on the importance of 
knowing how. I wish to add that ability and 
willingness to do are of at least equal im- 
portance. Many skilled workmen make their 
skill an excuse for slow work, and unless 
when they are taught hoiv to do they are also 
taught to do efficiently, they never attain the 
success that should be theirs. 

Under our task system the workman is 
taught hotv and trained to do at the same 
time. Knotving and doing are thus closely 
associated in his mind, and it is our experi- 
ence that the habit of doin.o- efficiently what 



TRAmiKG WORKMEN TO INDUSTRY 155 

is laid out for him becomes so fixed tliat lie 
performs without hesitation tasks at which 
a man not trained to follow instructions 
would absolutely fail. This is exactly what 
should be expected, and means nothing more 
than that in our industrial army the work- 
man who has gained confidence in his su- 
perior follows his orders without hesitation, 
just as the private soldier follows the orders 
of his officer, even though he does not see 
where they lead. This is not a fanciful com- 
parison, for I have known more than one case 
in which a workman expressed his doubts as 
to the possibility of doing a task, and on get- 
ting the reply that the task was all right, 
said, ^^If you say it can be done, I will do it.'' 
Workers who have been unable to perform 
their tasks in the time set have frequently 
asked to have an instructor stand by them 
with a stop-watch to time the detail opera- 
tions and show them just wherein they failed, 
with the result that they soon learned to earn 
their bonus regularly. 

The first essential for a workman to be- 
come successful under our task system is to 
obey orders, and having acquired this habit 
he soon finds out that a skilled investigator 
can learn more about doing a piece of work 



156 WOEK^ WAGES, AND PROFITS 

than he knows ^ ^ off-hand. ' ' Having satis- 
fied himself on this point, he goes to work at 
the tasks set him with the determination to 
earn his bonns, with the result, if he has the 
natural ability, that he soon becomes a rapid 
and skillful workman. 

Learning to obey orders is often the hard- 
est part of the workman's task, for a large 
percentage of men seem so constituted as to 
be apparently unable to do as they are told. 
As a rule, however, this is a feature of a cer- 
tain stage of their development only, which, 
under proper conditions, they overcome at 
a later date. For instance, many very cap- 
able men who were impatient of restraint 
when they should have learned a trade, find 
themselves at the age of twenty-five, or less, 
in the class of unskilled workmen, although 
their ability would have enabled them to do 
well at almost any trade. It is this class of 
men, when they have come to realize the dif- 
ference between a skilled workman and one 
not skilled, that furnishes us with many of 
our best task workers. Such men often see 
in our instructor, task, bonus, a chance to re- 
deem some of their earlier errors, and by 
learning thoroughly how to do, and doing 
one thing after another, in the best way that 



TRAIN"mG WORKMEN TO INDUSTRY 157 

can be devised, get in a short time a train- 
ing that does much to make up for the pre- 
vious neglect of their opportunities. 

BOSSES AS SEBVANTS AND TEACHERS. 

In a shop operated on this system, where 
each workman has his task, one man whom 
we term a gang boss usually tends a group 
of workmen, supplying them with work and 
appliances and removing the work when fin- 
ished. Such a man is paid a bonus for each 
workman who earns a bonus, and an extra 
bonus if all of his group earn their bonuses. 
The result is that so long as the workmen 
perform their tasks, though nominally their 
boss, he is really their servant, and becomes 
the boss only when a workman fails to per- 
form his task. The loss of money to the gang 
boss in case a workman fails to earn his 
bonus is such that he constantly has his eye" 
on the poor workman and helps him all he 
can. If, however, he finds that the workman 
is incapable of being taught, he uses his in- 
fluence to have a better man put in his place. 

In starting a shop on task work, an in- 
structor who is capable of teaching each 
workman how to perform his task must be 
constantly on hand, and must, as a rule, teach 



158 WORK, WAGES, AND PROFITS 

one workman at a time. This instructor may 
be the man who has investigated the work 
and set the task, or he may simply be an in- 
structor capable of following out the work 
of such an investigator, but he must be read- 
ily available as long as any of the workmen 
need his services, for we make it a rule not 
to ask a man to do anything in a certain man- 
ner and time unless we are prepared to show 
him how to do it as we specify. 

TASK SETTING. 

A task must always be set for performing 
a definite operation in a specific manner, a 
standard time being set for its accomplish- 
ment. As compensation, the workman is paid 
for the time set plus a percentage (usually 
20 to 50) of that time, provided the work is 
done in the time allowed or less. If the time 
taken is more than the time allowed, the 
workman gets his day's pay only. The fact 
that in setting the task the manner of per- 
forming the operation is specified enables us 
to set another task for the same operation if 
we develop a better or cjuicker method. 

If after having performed his task a work- 
man wishes to suggest a quicker or better 
method for doing the same work, he is given 



TRAINING WORKMEN" TO INDUSTRY 159 

an opportunity if possible to demonstrate 
his method. If the suggested method really 
proves to be quicker or better, it is adopted 
as the standard, and the workman is given a 
suitable reward. JVo ivorhman, however, is 
alloived to make suggestions until he has first 
done the work in the manner and time speci- 
fied. 

It is the duty of the investigator to de- 
velop methods and set tasks, and unless the 
methods developed by him are pretty gen- 
erally a great deal better than those sug- 
gested by the workmen, he is not retained in 
the position. Working at tasks is pretty 
good training for task setting, and I have 
gotten more than one task setter from the 
ranks of task doers. 

Inasmuch as, after a satisfactory method 
has been established, a large proportion of 
the work of the task setter is the study of the 
time in which operations can be performed, 
he is popularly known as the ^^Time Study'' 
man. This term has led to a misconception 
of his duties and has caused many honest 
people to claim that they were putting in our 
methods when they have put a stop watch in 
the hands of a bright clerk and told him to 
find out how quickly the best men were doing 



160 WORK, WAGES, AND PROFITS 

certain work. Unquestionably they liave in 
many cases been able to set more accurate 
piece rates by this method than they had been 
able to set by the older methods, but they 
are still far from our ideal, in which the best 
expert available investigates the work, stand- 
ardizes the appliances and methods, and sets 
a task that involves utilizing them to their 
very best efficiency. While the -stop watch is 
often used to establish a method, it is used 
to determine the time needed to do the work 
only when the standard methods and appli- 
ances are used efficiently. Stop-watch ob- 
servations on work done inefficiently, or with 
ill-adapted appliances, or by poor methods, 
are absurd and serve only to bring into dis- 
repute all work in which the stop watch is 
used. Moreover, such use of the stop watch 
justly excites the contempt and opposition of 
the workman. 

To make real and permanent progress, the 
expert must be able to standardize appli- 
ances and methods and write up such in- 
structions as will enable an intelligent work- 
man to follow them. Such standards become 
permanent, and if the workman is paid a 
proper bonus for doing the work in the man- 
ner and time set, he not only helps maintain 



TRAINING WORKMEN TO INDUSTRY 161 

the standards, but soon begins to exert Ms 
influence to help the progress of standardi- 
zation. 

STAND AEDTZATION. 

All work, and all knowledge, for that mat- 
ter, may be divided into two classes : Expert 
and Standard. Expert knowledge may be 
described as that which has not been reduced 
to writing in such a manner as to be gener- 
ally available, or exists only in the minds of 
a few. By analogy, expert work is work the 
methods of doing which either are known 
only to a few or have not been so clearly de- 
scribed as to enable a man familiar with that 
class of work to understand them. On the 
other hand, standard methods are those that 
are generally used, or have been so clearly 
described and proved that a man familiar 
with that class of work can understand them 
and safely employ them. 

The largest problem of our expert is to 
standardize expert methods and knowledge. 
When a method has been standardized, a 
task may be set, and by means of an instruc- 
tor and a honus a method of maintaining that 
standard permanently may be established. 
"With increasing efficiency on the part of the 



16^ WOEK, WAGES, AND PROFITS 

workman the standard always has a tendency 
to become higher. We have here the work- 
man and the foreman nsing their efforts to 
maintain standards, for both fail to obtain a 
bonus if the standard is not maintained. 
This is so different from the case in which 
the standard is maintained only by the man 
in authority with a club, that there can be no 
comparison. From workmen trained under 
these methods, we get a good supply of in- 
structors and foremen, and occasionally an 
investigator. From our investigators, who 
standardize our methods and appliances, we 
get our superintendents, and our system of 
management thus becomes self -perpetuating. 
The superintendent who believes that the sov- 
ereign cure for all troubles is to go into the 
shop and raise a row, has no place under 
our methods; for when the task and bonus 
has been established, errors are far more fre- 
quent in the office than in the shop, and the 
man who is given to bluffing soon finds that 
his methods produce no effect on men who 
are following written instructions. 

OBSTACLES. 

Among the obstacles to the introduction of 
this system is the fact that it forces every- 



TRAINING WORKMEN" TO INDUSTRY 163 

body to do his duty. Many a man in author- 
ity wants a system that will force everybody 
else to do his dnty, bnt will allow him to do 
as he pleases. The ^^Task and Bonus'' sys- 
tem when carried out properly is no re- 
specter of persons, and the man who wishes 
to force the workman to do his task properly 
must see that the task is properly set and 
that proper means are available for doing 
it. It is not only the workman's privilege, 
but his duty, to report whatever interferes 
with his earning his bonus, and the loss of 
bonus soon educates him to perform this 
duty no matter how disagreeable it is at first. 
We investigate every loss of bonus, and place 
the blame where it belongs. Sometimes we 
find it belongs pretty high up, for the man 
who has neglected his duty under one system 
of management is pretty apt to neglect it at 
first under another. He must either learn to 
perform his duty or yield his place, for the 
pressure from those who lose by his neglect 
or incompetence is continuous and insistent. 
This becomes evident as soon as the task 
and bonus gets fairly started and the effect 
is that opposition to its extension develops 
on the part of all who are not sure of mak- 
ing good under it, or whose expert knowledge 



164 WORK^ WAGES, AND PROFITS 

is siTcli that they fear it will all soon be stand- 
ardized. The opposition of such people, 
however, is bound to give way sooner or 
later, for the really capable man and the 
true expert welcome these methods as soon 
as they understand them. 

HELPS. 

The fact that the task and the bonus en- 
able ns to utilize our knowledge and maintain 
our standards, and that the setting of tasks 
after a scientific investigation must neces- 
sarily not only increase our knowledge but 
standardize it, brings to our assistance the 
clearest thinkers and hardest workers in any 
organization. Our greatest help, however, 
comes from the workmen themselves. The 
most intelligent soon realize that we really 
mean to help them advance themselves, and 
the ambitious ones welcome the aid of our 
instructor to remove obstacles that have been 
in their way for perhaps years. As soon as 
one such man has earned his bonus for sev- 
eral days, there is usually another man 
ready to try the task, and unless there is a 
great lack of confidence on the part of the 
men in the management, the sentiment rap- 
idly grows in favor of our task work. 



TRAINING WORKMEN TO INDUSTRY 165 

DAY WORK AND PIECE WOKK. 

As nsed by me, the ^^Task and Bonns'' 
system of pay is really a combination of the 
best features of both day and piece work. 
The workman is assured his day rate while 
being taught to perform his task, and as the 
bonus for its accomplishment is a percentage 
of the time allowed, the compensation when 
the task has been performed is a fixed quan- 
tity, and is thus really the equivalent of a 
piece rate. Our method of payment then is 
piece work for the skilled, and day work for 
the unskilled, it being remembered that if 
there is only work enough for a few, it will 
always be given to the skilled. This acts as 
a powerful stimulus to the unskilled, and all 
who have any ambition try to get into the 
bonus class. This cannot be too clearly borne 
in mind, for lue have here all the advantages 
of day tuorJc combined with those of piece 
work ivithout the disadvantage of either ^ for 
the day worker who has no ambition to be- 
come a bonus worker usually of his own ac- 
cord seeks work elsewhere, and our working 
force soon becomes composed of bonus work- 
ers, and day workers who are trying to be- 
come bonus workers. 



166 WOEK, WAGES^ A^iD PKOFITS 

CO-OPEEATIOK. 

When 25 per cent, of the workers in a plant 
are bonus workers, they, with those who are 
striving to get into their class, control the 
sentiment, and a strong spirit of co- 
operation develops. This spirit of co-opera- 
tion in living np to the standards set by the 
experts, which is the only way a bonus can 
be earned, benefits the employer by the pro- 
duction of 

More work. 

Better work. 

Cheaper work. 
It benefits the workmen by giving them ' 

Better wages. 

Increased skill. 

Better habits of work. 

More pleasure and pride in their work. 

Not the least important of these results is 
the fact that the workmen take more j)ride in 
their work, for this of itself insures good 
work. As an instance of this pride, I have 
known girls working under the task system 
to form a society, admission to which was 
confined to those that could earn bonus on 
their work ; the workers themselves thus put- 
ting a premium on industry and efficiency. 



TRAINING WORKMEN TO INDUSTRY 167 

The fact that we get better work, as well as 
quicker work, seems inconceivable to some. 
The reasons are: 

1. — Careful inspection, for no bonus is 
paid unless the work is up to the standard. 

2. — ^Work done by a prescribed method, 
and always in the same way. 

3. — Attention needed to do high-speed 
work, which keeps the mind of the worker on 
what he is doing and soon results in excep- 
tional skill. 

The development of skilled workmen by 
this method is sure and rapid, and wherever 
the method has been properly established, 
the problem of securing satisfactory help has 
been solved. During the past few years while 
there has been so much talk about the ^ ^ grow- 
ing inefficiency of labor,'' I have repeatedly 
proved the value of this method in increas- 
ing its efficiency, and the fact that the sys- 
tem works automatically, when once thor- 
oughly established, puts the possibility of 
training their oivn tvorkmen ivithin the reach 
of all manufacturers, 

TRAINING HELP A FUNCTION OF MANAGEMENT. 

Any system of management that did not 
make provision for obtaining proper ma- 



106 WORK, WAGES, AND PROFITS 

terials to work with would be tlionglit 
very lax. The day is not far dis- 
tant when any management that does not 
make provision for training the workmen 
it needs, will not be regarded as much bet- 
ter, for it is by this means only that a sys- 
tem of management can be made permanent. 
To be satisfied to draw skilled workmen from 
the surplus of other plants means, as a rule, 
that second-rate men only are wanted, and 
indicates a lack of appreciation of the value 
of well-trained, capable men. The fact that 
few plants only have established methods of 
training workmen does not necessarily mean 
that the managers are satisfied with that con- 
dition, but rather that they know of no train- 
ing system that can be satisfactorily oper- 
ated in their plants, and as questions are 
sure to be asked about the method of intro- 
ducing this system, a few words on that sub- 
ject may not be amiss, it being borne in mind 
that the changing of a system of manage- 
ment is a very serious matter, and cannot he 
done by a busy superintendent in his spare 
time, 

METHOD OF I:^TTE0DUC^^l0N. 

In order to set tasks, we must^ know before- 
hand what work is to be done, and who is to 



TRAINING WORKMEN TO INDUSTRY 169 

do it. In order to pay a bonus, we must 
know after the work is done whether it was 
done exactly as specified. Hence our first 
care in starting to introduce this method is 
to provide means for assigning tasks to the 
workmen, and means for obtaining such a 
complete set of returns as will show just 
what each man has done. When this much 
has been introduced, the output of a plant is 
always increased and the cost of manufac- 
ture reduced. 

The next step is to separate such of the 
work as is standard, or can be readily made 
standard, from the more miscellaneous work, 
and to set tasks for the standard work. Then 
we begin to standardize, and as fast as pos- 
sible reduce the expert and increase the rou- 
tine work. The effort to classify and stand- 
ardize expert knowledge is most helpful to 
the experts themselves, and in a short time 
they begin to realize that they can use their 
knowledge far more efficiently than they ever 
dreamed. 

As soon as work has been standardized, it 
can be intelligently planned and scheduled, 
each workman being given his specific task, 
for which he is paid a bonus when it is done 
in the manner and time specified. As bonus 



170 WORK, WAGES, AND PROFITS 

is paid only on the written statement of tlie 
inspector tliat the whole task has been prop- 
erly done, failure to earn a bonus indicates 
that our plans have not been carried out. 

An investigation of every case of lost 
bonus keeps the management closely in touch 
with the progress of the work, and as the 
workmen are ever ready to help disclose and 
remove the obstacles that prevent their earn- 
ing their bonus, the managing problem is 
greatly simplified; for, as one of my co- 
workers has very aptly put it, '^the frictional 
lag due to the hiertia of the ivorhman is 
changed hy the bonus into an acceleration/^ 

"With increase in the number of bonus 
workers, this force of acceleration increases, 
and not only does the careless worker, who 
by his bad work prevents some other from 
earning his bonus, fall into disfavor, but the 
foreman or superintendent who is lax in his 
duty finds his short-comings constantly 
brought before him by the man whose duty 
it is to. investigate all cases of lost bonus. 

MOEAL TRAINING. 

The fact that under this system, every- 
body, high and low, is forced by his co- 
workers to do his duty (for some one else al- 



TRAINING WORKMEN TO INDUSTRY 171 

ways suffers wlien he fails) acts as a strong 
moral tonic to the community, and many 
whose ideas of truth and honesty are vague 
find habits of truth and honesty forced upon 
them. This is the case with those in high 
authority, as well as those in humble posi- 
tions, and the man highest in authority finds 
that he also must conform to laws, if he 
wishes the proper co-operation of those 
under him. 



FIXING HABITS OF INDUSTEY 



Chapter IX 

FIXING HABITS OF INDUSTEY 

T HAVE done mucli to train and educate 
'*' workmen, and consequently liave seen 
the far-reacMng results that would follow 
if manufacturers in general would adopt a 
policy of educating and training the work- 
men they need. The preceding chapter on 
*^ Training Workmen in Habits of Industry 
and Co-operation'' defines the general ad- 
vantages of such a policy. In this chapter I 
shall give specific examples of what has 
been done. 

In 1905 I was engaged by a cotton mill to 
take up the question of making their labor 
more efficient, but as they were very con- 
servative people we proceeded slowly. The 
superintendent and foremen were most of 
them English or Scotch, who were satisfied 
that the way they had done things in the old 
country was all right, and they objected to 
any change. The work proceeded very 
slowly indeed, but we gradually succeeded 
in getting our time and record system estab- 

175 



176 WORK^ WAGES, AND PROFITS 

lished and then a reliable cost system soon 
followed. We were, however, nnable to do 
anything for a long time that had any great 
effect on the work itself, and after we had 
succeeded in getting the cost system in oper- 
ation I told the treasurer that we had done 
about all that was possible under the condi- 
tions existing. The little that had been done, 
however, was so beneficial that in April, 
1908, the treasurer asked me to come and 
finish up the job, saying that he now had a 
new superintendent who was in sympathy 
with the work, and that the worst foremen 
were gone. 

During the year or more within which I 
had not visited the mill, attempts had been 
made to extend the work already started, but, 
from lack of experience on the part of those 
engaged in it, practically no progress had 
been made. 

"When I took it up again my instructions 
were carried out conscientiously, and men de- 
tailed for the work were kept on it continu- 
ously. 

Twelve new looms had recently been in- 
stalled in the weave room, and as soon as a 
competent man could be got we began to 
study how to run these looms most efficiently. 



FIXING HABITS OF INDUSTRY 177 

A pick counter was put on each loom, and the 
best weaver in the room (a Pole named Sam- 
tak) was given four of them to run. 

A trained observer with a stop-watch stood 
by the weaver and studied all his motions in 
detail. He learned how this skilful weaver 
stopped and started his loom, how he re- 
moved the empty bobbin from the shuttle and 
put a new one in, how he tied the knot. From 
these observations he found out how much 
time it was necessary for the loom to be 
stopped in a day, and consequently what 
proportion of the time it should be actually 
weaving. No time was allowed for ^4oom 
out of order,'' or **no filling,'' or any other 
cause that might be eliminated. Steps were 
taken to be sure that the loom was in good 
order and that proper filling should always 
be on hand, and a task was set on the suppo- 
sition that all removable obstacles would be 
removed. This task was fixed as the number 
of picks the loom should throw provided 
these unnecessary delays were eliminated, 
and a substantial bonus was offered for its 
accomplishment. It was expressed as a per- 
centage of the total number of picks the loom 
would throw if it ran constantly all day with- 
out any stop. It is interesting to note that 



178 WORK^ WAGES^ AND PROFITS 

the task was greater than the best weaver 
had been able to accomplish regularly before 
we had made special provision to remove the 
obstacles. Having decided npon the task, 
three of the next best weavers in the room 
were chosen to do it and Samtak was the in- 
structor to teach them how. 

The three men chosen are those whose 
names are at the top of Chart II (facing page 
182). They were all Greeks, speaking almost 
no English. The instructor, Samtak, is a 
Pole, whose English is not very good, and 
who could make himself intelligible to the 
Greeks only by signs. The first man, Papa- 
dimitri,* declined to work under instructions 
and on task work. He was not discharged 
but allowed to work his own way until he 
should see where his interest lay. We there- 
fore had Samtak give all of his attention to 
the other two, our observer, who had studied 
Samtak 's work, being constantly on hand 
keeping a record of the number of picks each 
loom threw per hour, and removing the ob- 
stacles to the men's performing the task. 
Both men failed to earn a bonus on the first 
day — this is shown by the red mark — ^but on 
the next two days they came so near it that 

* Papadimitri is now (April, 1913) conducting a 
training school for weavers in the same mill. 



FIXING HABITS OF INDUSTRY 179 

it was allowed them, and they got a black 
mark. 

Our observer, however, satisfied himself 
that failure to perform the task was due to 
the fact that the warps and filling were not 
coming in a satisfactory manner, and that 
some of the looms were not just right. He 
accordingly ceased for a time to urge the 
men to perform the task, and devoted his at- 
tention to getting things in such a condition 
that these obstacles would be removed. The 
black cross shows that the men were on day 
work and were making no special effort to 
perform a task. At the end of eleven days 
our observer felt that conditions were all 
right and he started the men again. Papa- 
dimitri by this time had concluded that we 
were going to ''play fair'' and wanted to 
start too. The black lines on the chart show 
how soon all began to make their bonus 
pretty regularly. 

It was necessary, however, for our ob- 
server to be constantly on hand and to keep 
a record of their work hour by hour, for he 
would frequently find some loom falling be- 
hind, which, if not looked after, would cause 
the weaver to lose his bonus. Whenever he 
found a loom not doing all it should he called 



180 WORK, WAGES, AND PROFITS 

Samtak's attention to it, with the resnlt that 
the canse was soon discovered and removed ; 
bnt Samtak seldom at first noticed a lagging 
loom. Again, Samtak was at first very slow 
at making any complaint if anything was 
wrong, but the example of onr instructor and 
the incentive of a bonus of 6 cents for each 
weaver who made his bonus, and 10 cents 
each if all made bonus, gradually taught him 
to look out for their interests and his own. 
It took the entire time of our observer for 
several w^eeks to get the conditions such that 
no obstacle would arise w^hich Samtak could 
not remove. It must be remembered that 
while Samtak was a good weaver, he was not 
a teacher. He had in the past been trained 
not to object when things went wrong, but to 
do the best he could without complaining. 
Even with the example of the instructor and 
the incentive of a bonus, it was some time 
before he realized that we really intended 
that he should assert himself. 

We began to study the looms about the first 
of June, and started the first task workers 
early in July, but it was nearly the middle 
of August before we were ready to start 
others on task work. By this time other 
weavers were willing to try, but it required 



FIXING HABITS OF INDUSTRY 181 

the attention of both Samtak and our ob- 
server to get these men going right. It took 
the first two of these men about three weeks 
to become skilful enough to do the task, but 
the third, fourth and fifth did it from the 
start. During September and October several 
more gradually became proficient. 

By this time we had gotten all of the best 
weavers on task work, and henceforth we 
had to train the poorer ones, which partially 
accounts for the sudden increase of red 
marks. Another cause for this increase was 
the fact that several trained weavers left. 
They had not yet become convinced that we 
were going to treat them fairly, and left for 
some insignificant cause. The dropping out 
of these men shows the importance of time 
in doing this work. Until the workmen be- 
come thoroughly satisfied through their own 
experience that the job they have is the best 
one they can get, they may be stampeded by 
a very slight cause. 

Our gang had now become too large for 
Samtak, whose allotment was twelve weav- 
ers ; and we started another gang, placing in 
charge of it the weaver Shea, whose name 
indicates his nationality. He was the only 
bonus weaver who could speak English. 



182 WORK^ WAGES^ AND PROFITS 

While there are some exceptions the chart 
has a tendency to become blacker slowly as 
time progresses. 

Chart III* shows the record of Samtak^s 
gang from March 1 to October 9, 1909. This 
chart distinctly blackens as time progresses. 
This means more than that the men have ac- 
quired the skill to do the work. They have 
acquired the habit of working steadily and 
keeping their attention on their work. The 
red crosses signifying absence are notably 
lessened. These men have not only improved 
in skill, but in habits of industry; and the 
gang boss Samtak is not their driver, but 
their helper and friend. The blackening of 
the chart signifies not only that more work 
is done, but that it is done better, for black 
means that both quantity and quality are up 
to the standard. There is one man in the 
group w^hose history is worth studying, 
namely the weaver Samtak, brother of the 
gang boss. Note that he began on this work 
on September 21, 1908. He was a good 
weaver who had been working in the mill off 
and on for several years. His temper is such 
that he was liable to leave on the slightest 
pretext, but in a few weeks or months he 

* Chart III is placed below Chart II, on the same 
sheet, facing this page. 



gAHTAK 

SPAWS 

riSSIONA 

Hammerick 

Vakbs 



MOSKIU 

SlDUK- 

KioAinn 
UicaiB 



Symowicz 

SOPKO 

Sntowicz 
Oau 



Papadimitbe 

Sparis 

Kebles 

Besek 

Fessiona 

svmowicz 

scanooreila 

Tymowich 

Smith 

Samtak 

Pehouskt 

EAMMSBlat 
KEtLECK 

May 
Stazewski 



Weavbrs 



September 




CHART II. TASK AND BONUS SYSTEM IN A WEAVE ROOM. NOTE THE INCREASE OF BLACK (MEANING TASK ACHIEVTED AND BONUS EARNED) A3 TIME : 
CHART III. THE RECORD OF THE SAME ROOM CONTINUED THROUGH THE FOLLOWING EIGHT MONTHS. THE HABIT OF INDUSTRY HAS BECOME MXED. 



FIXING HABITS OF INDUSTRY 183 

would come back for a job, probably having 
left bis new job for some similar slight cause. 

He would not do task work at first, al- 
though offered a chance, but took hold when 
he found others profiting from it. The old 
habit, however, of quitting on a slight pre- 
text was still on him, and he left before 
Christmas. By the first of the year he was 
back, but he had lost his ability to make his 
bonus, and he spent nearly two weeks before 
he earned it a single time. Note also that he 
was absent three days in the first two weeks. 
Was he again looking for another job? His 
actions during this time indicate an unsettled 
frame of mind. Again in the latter part of 
February the wanderlust came over him. 
Early in May he again had a slight attack, 
possibly of *^ spring fever." Since that time 
he seems to be entirely cured of his roving 
tendencies. 

We knew this man and understood his 
moods, and we know what kind of a change 
has taken place. Have not many others been 
influenced in the same manner! 

In considering this work an important ele- 
ment to be noted is the time needed. When 
we began our study in June, 1908, we already 
had in operation means for learning how long 



184 work:^ wages^ and profits 

each worker spent on every job and how much 
work was done. There was also in existence 
a system of laying out the work from the 
office. In other words, the general mechan- 
ism of onr system was in operation and work- 
ing smoothly, yet it was several months be- 
fore we got enough task work going to make 
any real show. If we had attempted to in- 
troduce it much faster we should have met 
with two difficulties. First, it would have 
been impossible for us to remove all the ob- 
stacles for a large number of weavers. Sec- 
ond, the poor weavers would probably have 
persuaded the good ones not to try to do as 
we wished. The best evidence of this is that 
Papadimitri, one of the very best weavers, 
declined to do the work at first. 

Time is needed to overcome prejudice and ) 
to change habits. This is a psychological 
law, and its violation produces failure, just 
as surely as the violation of the laws of phys- 
ics or chemistry. 

Chart IV * represents our progress in 
training workers to do their task in winding 
weaving bobbins — ^bobbins of filling that go 
into the shuttles. Each operative tends a 
number of spindles, and the work consists 

* Chart IV is inserted between pages 186 and 187. 



FIXING HABITS OF INDUSTRY 185 

first of taking out full bobbins and putting 
empty ones in place ; second, removing empty 
spools from which the yarn has been taken, 
and replacing them with full spools. Inas- 
much as the machine runs at a constant 
speed, the bobbins fill and the spools empty 
more rapidly with coarse yarn than with fine ; 
hence it was necessary to make a careful de- 
tail study of the subject to set a proper task 
for different sizes of yarn. This study took 
about six weeks, and, having settled upon 
proper tasks, we started a girl named Wag- 
ner on task work early in February. She 
would not do it at first but stayed home for 
a week. At the end of that time she came 
to work willing to do as we wished, and was 
evidently surprised at the ease with which 
she succeeded. On March 1 we began to keep 
the charts. At that time those doing the task 
as shown by the chart represented but a small 
proportion of the whole number of workers. 
Our gang boss, McCabe, received 5 cents for 
each worker that made a bonus and 10 cents 
each if all made it. Our observer was con- 
stantly on hand, at first to help him remove 
obstacles, and to see that the workers had 
every opportunity to work efficiently. In 
spite of this a large proportion of the first 



186 WORK^ WAGES^ AND PROFITS 

ones failed to earn the bonns regnlarly and 
gradually left. Many of these were girls who 
evidently f onnd continuous attention to their 
work irksome, and, even though they were 
capable of doing the work, preferred the 
more free and easy method to which they 
had been accustomed. Others showed but 
little ability to do the work or to learn. The 
fact, however, which is evident from the chart 
— that the larger the number of bonus work- 
ers in the mill, the faster the new ones 
learned — is a matter of great psychological 
importance. There is in every workroom a 
fashion, a habit of work, and the new worker 
follows that fashion, for it isnH respectable 
not to. The man or woman who ignores fash- 
ion does not get much pleasure from associ- 
ating with those that follow it, and the new 
member consequently tries to fall in with the 
sentiment of the community. Our chart 
shows that the stronger the sentiment in 
favor of industry is, the harder the new mem- 
ber tries and the sooner he succeeds. We 
must therefore make our compensation such 
as to encourage the habit, or fashion, of in- 
dustry; and our charts show to what extent 
we have succeeded in fixing this habit. 

It is interesting to note that although fail- 



Filling Winders ^^ 

March 1909 



NUTIBOOK 
DiTOBAX ' 
MOKBI8OK 



Vahbtki 

JOBSAN 



Bajai 

Cooo 

SiBOKA 
KEBU8 

Sauoii 

Babx 

TaoBB 

Tiuws 

Kbiou 



Tout 
Alvi 



FXOR 

KALDfAK 

SWAH 

Babt 

TiKD 
MAOnOA 



Sforab 
Zakiiti 



VAintnpiLi 

NlOROV 




CHARTilV. TASK AND BONUS RECOED OF WORKERS WINDING WEAVING BOBBINS. NOTE DISAPPEARANCE OF THE HABIT OF SLACK WORK ON MONDAYS. 



FIXING HABITS OF INDUSTRY 187 

ures most frequently occurred on Monday, 
even this habit could be cured. 

The mill shut down for about three days 
about July 4 to take stock, and, as we had 
just gotten this room in good shape, that little 
vacation may be used as a dividing line on 
this chart. Remembering that solid black 
indicates that the full amount of work has 
been done, and that all of it was up to stand- 
ard for quality, while solid red represents 
that the work was below standard either for 
quantity or quality, and sometimes for both ; 
also that the black cross means the worker 
was doing day work, while the red cross 
means that the worker was absent, the 
amount of black on any day is a measure of 
efficiency for that day and the red is a very 
accurate measure of the amount of super- 
vision needed, for all cases of failure to per- 
form the task must be investigated, and all 
cases of absenteeism should be inquired into. 
The gradual change of the chart from red to 
black means not only that the workers are 
becoming more skilful and regular in their 
habits, but that the machinery is being kept 
in better order, for the task is so set that 
unless the machines are in good condition the 
bonus cannot be earned. 



188 WORK^ WAGES, A^B PROFITS 

After July 4, not only was the amount of 
supervision needed diminislied and a regular 
output maintained, but the workmen were 
much more regular in attendance. The in- 
dications of the chart are that the output of 
the room after July 4 was larger, better and 
more uniform. It is now easy to predict the 
daily output and to make promises of deliv- 
ery that will be kept without special effort 
on the part of the foreman. Before July 4 
such predictions were only estimates, and a 
proper output was kept up only by constant 
supervision. As the gang boss in this room 
gets a bonus of 5 cents for each worker who 
earns a bonus, and 10 cents each if all earn 
bonus, it is easy to see that the superinten- 
dent does not have to worry much either 
about the quantity or quality of the product. 
It is easy to measure the quantity, and the 
quality is taken care of more easily still, for 
the weaver who gets poor bobbins refuses to 
use them. 

By permission of the treasurer of this mill 
I am enabled to show Chart V representing 
the conditions in this room in 1912, three 
years later. The preponderance and continu- 
ity on this chart of black spaces showing task 
performed is very marked. 



FIXING HABITS OF INDUSTRY 



189 



No. 



Sept. 



Oct. 



Nov. 



1912 



23 2830 57 12 14 19 2126 28 24 



U 1618 



m 



631 
641 

642 
643 
649 
651 
652 
654 
656 
658 
659 
661 



667 
669 
670 
671 
677 
€76 
€16 



■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■■IfHJJuHHnHHiMni 



.■■■«H«iH»HHj|;nHn»HniiHnHH«Hin||| 



■■■■■I ■■■■■■ ■■■■■! ■■■■■ii ■■■■■■ ■■■■■■ ■dliHiimiiilllilSiH 



CHART V. BONUS RECORD, THREE YEARS LATER, OF FILLING 
winders' DEPARTMENT SHOWN IN CHART IV 

Chart VI* (facing page 190) represents 
girls winding yarn on spools. Note that it 
was the fashion among these not to try for 
the bonus on Saturday. Most of them could 
earn it every day if they chose, but there 
was evidently a feeling against working hard 
on Saturday. 

* Charts VI and VII, on one sheet, are inserted be- 
tween pages 190 and 191. 



190 woee:, wages^ and profits 

Note tliat on March 6 two girls tried to 
break this precedent, but it was too strong, 
and on March 13 all failed. On March 20 an- 
other tried. On March 27 one of the first two 
tried again, but after that all gave it up for 
three weeks. Then our first two evidently 
decided that they would defy public opinion, 
which they did pretty successfully until 
June 6, when apparently by common consent 
all *^took it easy." After that, however, all 
gradually fell into line and the Saturday in- 
efficiency disappeared as did the Monday 
inefficiency on Chart rV. 

Chart VII * represents girls inspecting 
cloth and mending slight defects in weaving, 
trimming ends, etc. This is high-grade work 
and all defects must be eliminated. We 
started the task after careful study, and 
while most of the girls showed the ability to 
perform the task only two did it with any de- 
gree of regularity. On April 7 three left be- 
cause they were unwilling to maintain the 
high standard of quality that had been set. 
The chart shows the difficulty of getting new 
ones to do the work. Fortunately the three 
dissatisfied ones came back for their jobs in a 
few days, and soon became better than ever. 

* Facing this page, on lower half of sheet. 



Spoolers 



rosoL 

VANOER 

Wasdyke 

Nick 

Pearson 

VANDYKK 
POLLARD 

parastach 

mohowenze 
Opudo 

OOZZO 

Smith 

Fedosak 

bobsckak 

BODIS 

Parahaj 
Plockhooy 
Swan 
Oasteline 



Novak 

MARTIN 

Orost 
Barclay 
Francis 
Bremmbr 
Landon 
Holmes 

KILROE 

Wagner 
Bremmer 
Bills 
Barclay 



Vandyke 
Vanriper 

SiLCOX 
ROSENTINGEL 



Inspect 




CHART VI. TASK AND BONUS RECORD OF GIRLS WINDING YARN ON SPOOLS. NOTE DISAPPEARANCE OF SLACK-SATURDAY HABIT. 
CHART VII. TASK AND BONUS RECORD OF CLOTH INSPECTORS AND MENDERS. NOTE IMPROVEMENT FOLLOWING ESTABLISHMENT OF 



BONUS TO HEAD WEAVER EARLY IN JULTf 



FIXING HABITS OF INDUSTRY 191 

These inspectors were supplied with work 
and had the heavy cloth handled for them by 
the three men whose names are at the top of 
the chart. Each of these men received 2 cents 
for each girl that made a bonus. Early in 
July it was decided to give the boss weaver, 
who has not yet been mentioned, a bonus. He 
is an excellent man and was undoubtedly do- 
ing his work well, but we felt that his bonus 
should depend upon the quality of the work 
turned out. Inasmuch as the better the cloth 
was when it came from the weaving room, the 
easier the task of the inspectors would be, we 
decided to make his bonus in proportion to 
the number of inspectors that earned theirs. 
The inspectors at once began to earn bonus 
with great regularity, for the boss weaver 
found that the inspectors were only too anx- 
ious to point out defects which it was to his 
interest to have corrected. He visits the in- 
specting room frequently during each day, 
and by the reports he gets keeps closely in 
touch with what his weavers are doing. The 
result is a continuous improvement in the 
quality of their work. 

The charts so far shown all refer to the 
same mill. It is interesting to know that in 
1912 the Industrial Workers of the World 



192 WORK^ WAGES, AND PROFITS 

made an attempt to cause a strike in all of 
the mills in the town where this mill is situ- 
ated, and actually succeeded in shutting down 
some of these mills for several weeks. In 



Dprp attwa 








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U09 




. I'etw 


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4 OJll irflR 


2£ia5 9 


1 dd dl5 dM 9i 


Clara COBRiGAN 
Frances Grogai 
Theresa Liepew 
Mart Livse¥ 

r.KlTCHEN 
K.KAUJttU» 


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nUfl aallll 

^■M iMaaa 

^■^•| Viiiaa* 


Clara Corrigan 


r.(' 


■11 


JUances Gbogai 
Theresa Liepee' 


*^"" 


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111 IT 


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Mart LivsET 


V ^IJV 


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r,KlTCHEN 

KKallahas 


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KEY MBonas Earned 9 Bonus Lost X^^ay Work X. Absent 

CHAET Vm. BONUS EECOED OF GIRLS WOEKIXG I:n' A FOLDING 
ROOM 

""^ The upper half shows eight weeks in 1909; the lower half, the 

corresponding eight weeks in 1910. Remembering that red means bonus 

lost a,nd black bonus earned, the improvement in twelve months becomes 

strikingly apparent. 

this mill, on which they made a very strong 
attack, they succeeded in drawing out only 
sixty out of six hundred employes, and the 
management had no difficulty whatever in 
filling all their places in a few days. 

Chart VIII represents girls working in the 
folding room of a bleachery — not one of those 



FIXING HABITS OF INDUSTKY 193 

previously referred to — and is interesting 
from the fact that they belong to an entirely 
different class of people from those in the 
cotton mill (as can be seen by their names), 
and also from the fact that some of these 
girls have often as many as ten or fifteen 
different kinds of work per day. In starting 
this group, which is much larger than the 
number shown here, we had exactly the same 
experience as with the weavers and the wind- 
ers; one of the girls declined to do as we 
wished at first, and afterwards became one 
of our best workers. These three cases il- 
lustrate the fact that a worker may hesitate, 
or even refuse to do work by a new method, 
and still become ultimately a good and loyal 
worker under the new methods. The action 
of a workman when brought up against a 
new method is largely influenced by his tem- 
perament, or the opinions of his friends. 
When, however, this method has been estab- 
lished, all the evidence available goes to show 
that these results are not only permanent, 
but that the workers become more proficient 
and the product better. This chart shows the 
improvement after a year's training. We 
began the task and bonus in November, 1908. 
The upper section of the chart shows how the 



194 WORK^ WAGES, AND PROFITS 

girls worked about the time the system got 
well started. The lower section is a record 
of the same girls a year later. 

Directing attention once more to Chart 
VIII, it will be noted that the date is 1909. 
The work was begun some time in the fall of 
1908. In January, 1912, the conditions were 
as follows: — 

Three of these girls were still working on 
the same job, on bonus. One of the three 
had left for a few weeks in the meantime, 
but came back again. One girl had been 
promoted to a better job. One girl had been 
transferred to other work and had subse- 
quently left. The sixth girl was working in 
January, 1912, but left before the end of the 
month. 

Charts IX and X represent girls at work 
in a worsted mill. The best workers 
were put on bonus work first. Note their 
improvement. It was nearly three months 
before we got all on this work. Note how 
the poorer ones failed at first, also how on 
the last day shown on the chart all of the 
poorer workers earned bonus. During the 
period from April 15 to July 10, 161 girls 
had been put on bonus work, and 21 out of 
this number had for one reason or other left 



BOKTJS EECORl> 



HI 


«.„. n..^Worst^BurliiY ^ ^ ^ ^ 


For...G^ 


Worsted Burling 


1 IM * 1 1 1 li 


July 


i 




rh* 


i 


m 




^^B 


iiili^^i 


^ 


1 


■i 




■ 




i 


1 






1 




m 



CHART IX. BONUS RECORD OF GIRLS PUT ON TASK WORK FIRST. THESE WERE THE BEST WORKERS. NOTE IMMEDUTE ACCOMPLISHMENT OF TASK. 




THE LAST DAY SHOWN ON THE CHART. .v. „„juv of tho worker. »t the bepnning of the task and bonu. method.. The total number of girls wm 161. 

ChteU IX and X refer to the same room. «ame work, same oonditions. the difference bemg only in the quahty of the worMia 



nXIN'G HABITS OF INDUSTRY 195 

the employ of the company. The reasons 
were as follows : — 



4 girls — left ; poor health or dissatisfied 
1 girl — ^married 

1 girl — entered convent 

1 girl — work at mountains for summer 

5 girls — left town; gone home to Canada, 

Michigan and New York 
9 girls — discharged 



21 



One of the obstacles, which by the way we 
nearly always encounter, was prominent in 
this case. Certain people in authority hav- 
ing once expressed themselves as not approv- 
ing of our methods, felt it their duty to op- 
pose their introduction to as great an extent 
as possible, and to use all possible arguments 
against the work. Their original arguments 
failed. The argument that we were over- 
working the girls was then advanced, and 
they insisted on being allowed to put on 
piece work some of this work which was in 
another building, and which had not yet been 
put on the task and bonus system. Accord- 
ingly, on June 19 their piece work was 



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FIXING HABITS OF INDUSTRY 197 

started. On July 11, the date of this report, 
nineteen out of a total of fifty-three girls in 
this building had left. In other words, al- 
most one-third of the girls who were put on 
piece work, according to the request of the 
man ' ^ who had their interests most at heart, ' ' 
left in three weeks ! In the case of our bonus 
workers, approximately one-eighth of the 
girls left in fifteen weeks. 

Which system was most considerate of the 
workers may well be left to the reader's 
judgment. 

Chart XI represents weavers in a cotton 
mill. Each weaver is running twelve looms, 
and gets a bonus for each loom which does all 
the work it should do on any given day, and 
an additional bonus if all his looms do the 
full allotted amount. The number in the 
space represents the number of looms on 
which the bonus is earned. Eed is used to 
call attention to the smaller numbers. The 
black spot indicates that all the looms earned 
bonus. 

On this job bonus work was started really 
before we were ready for it, but inasmuch 
as the management was very anxious to get 
some bonus work under way we felt it neces- 
sary to do what was possible to conform to 



198 WORKj WAGES^ AND PROFITS 

their wishes, knowing, however, that the work 
would necessarily go very slowly. 

It \vill be noted that several weeks elapsed 
after putting the first weaver on bonus before 
any others were put on. This delay was 
necessitated by the fact that the failure of 
the man to make bonus was not always his 
fault, but was due to conditions over which 
he had no control, and it took some time to 
eliminate these conditions as far as he was 
concerned. 

Somewhat more rapid progress was made 
later in putting other workers on bonus, and 
for a while things went very well. The chart 
shows, however, that we soon attempted to 
go too fast, for not only did those weavers 
who had previously been making bonus on 
all looms fail to accomplish this result, but 
some of the weavers (newer ones) failed to 
make bonus on any. These facts emphasize 
the importance of going slowly and bending 
all our efforts to getting conditions right be- 
fore we make any attempt to increase the 
number of people on bonus. When it is 
realized that each of these weavers was 
handling twelve looms, it will be seen that we 
already had quite a proposition on our hands. 
Inasmuch, however, as the weavers were get- 



FIXING HABITS OF INDUSTRY 199 

ting a fair day's pay, they showed patience 
and gave ns all the assistance they could in 
our attempt to make things go right, with the 
result that in a few weeks things were on a 
satisfactory basis again. 

This work was being done during the Law- 
rence strike, and the Industrial Workers of 
the World had their agents around doing 
what they could to stir up dissatisfaction 
among the employees, using, of course, any 
influence they could against this work. In 
another room in the same mill work simi- 
lar to this was being done in almost identi- 
cally the same way, when a strike took place 
in that room, probably stimulated by the In- 
dustrial Workers of the World. We had 
extended our system to about half the people 
in the room at this time, and, strange as it 
may seem, our workers were not the ones 
that went out on the strike — all of our people 
not only stayed on their jobs, but brought in 
their friends to take the place of the strikers. 
In another textile mill nearly all the em- 
ployees went on a strike in 1905 ; almost the 
only ones who remained loyal were those 
working on our system. 

Chart XII represents girls making sheets 
and pillow cases. The work of starting the 



200 WORK, WAGES, AND PROFITS 

task and bonus was done by a man who had 
been connected with me, but who was doing 
this on his own responsibility. I was not per- 
sonally in touch with this work when it was 
done. First, note should be made of the fact 
that the factory was shut down on a number 
of days — November 28 (evidently Thanks- 
giving Day), Christmas Day, and all Wed- 
nesdays and Saturdays for the next two 
weeks. It will be seen that the work started 
off very well, but the rush to get people on 
bonus on November 30 evidently upset things, 
for immediately we find a number of workers 
back on day work. This was probably due 
to the inability of the task setter to set tasks 
on new work fast enough. Note again that 
just before Christnias week the same condi- 
tion obtained, and after Christmas there was 
not enough work to keep the factory running 
full. However, by the middle of January 
those that had bonus work w^ere beginning to 
earn their bonus pretty regularly, and by 
February 10 the number of workers was 
just about large enough for each to be sup- 
plied with a full amount of work. From that 
time on the work went smoothly. 

This chart is presented to show how easy 
it is to get into trouble by putting people on 





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FIXING HABITS OF INDUSTEY 201^ 

bonus work too fast. The management has 
its part to play in supplying work and train- 
ing workers, and it is perfectly evident in 
this chart that the trouble was not with the 
workers, but with lack of proper balance in 
the managing department. This, however, is 
not at all surprising, for when the man re- 
sponsible for the output finds the advantage 
he can obtain by the task and bonus system, 
he almost invariably insists on putting as 
many- people on bonus as possible, with the 
result that he finds he cannot supply all the 
workers properly and that numbers of them 
have to be put back on day work. 

It may be asked why the task-setter does 
not explain this to the superintendent, and 
make it clear that that is the wrong way to 
do. I can say only that no amount of ex- 
planation on my part, or that of my repre- 
sentatives, seems to have much effect, and 
we have about come to the conclusion that 
the best way to do is to let managers make 
their mistakes and find them out; then the 
question is settled once and for all time. 

Chart XIII is a particularly interesting 
one, inasmuch as it is the most recent — the 
development is still going on. I am permit- 
ted to exhibit this by the manager's courtesy. 



202 WOEK^ WAGES^ AND PROFITS 

It will be seen that here also the work 
started off very well, and until we began to 
push it too fast everything went alh right. 
When, however, the desire to get an in- 
creased output overcame the conservatism 
with which it is necessary to establish a new 
method, those workers Avho were last put on 
influenced the others not to perform the task, 
and on one day nobody made bonus. One 
girl, however, felt that she needed the money 
and continued on with the work. The others 
showed their hostility toward her in a num- 
ber of ways, but she still persisted. After 
they had ceased to try to do the work for 
three or four days, several of the girls sent 
in their notice that they were going to quit. 
They were evidently tr^dng to raise an issue, 
but inasmuch as the management ignored the 
issue, and went about its business of getting 
conditions so perfect that the workers could 
have no cause whatever for not trying to earn 
their bonus, they were unable to get the issue 
accepted. It will be noted how at the end of 
eight days some of the girls became willing 
to try again, and from that time on the num- 
ber increased, and soon the number of appli- 
cations from other girls to work on task and 
bonus became so great that we were unable 



I 



FIXING HABITS OF INDUSTRY 203 

for some time to provide proper conditions 
and to set tasks for them fast enough. 

CO-OPEEATION 

A careful analysis will show that we have 
established a system of co-operation, in which 
it is to the interest of each bonus worker to 
do as much work as he can, and to do it as 
well as possible. Further, if a workman does 
poor work, others suffer beside himself, with 
the result that he either learns to do good 
work or finds work elsewhere. As it is to 
the interest of the worker to do good work, 
and plenty of it, he contracts the habit of 
doing a large amount of good work. As long 
as it is to his financial interest he will con- 
tinue to cultivate this habit. 

Taking all of these charts together we note 
the following: That the amount of super- 
vision needed has diminished ; that the qual- 
ity of the work is better ; that the quantity is 
greater; that the amount being turned out 
can be predicted accurately, and hence prom- 
ises need no longer be guesses, but can be 
made and kept ; that the workers are not only 
earning more money, but are acquiring bet- 
ter habits of work which will make them bet- 
ter citizens. 



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CHART XIII. ^^^^ ^^^ ^^^ ^^^^ ^^ ^^^^^^ performinB twk daUy. Note complete u« ,lmate miooew m in.ite of m.t.»l hoetaUty of woAete. 



RESULTS 



Chapter X 

EESULTS 

A FTEE seeing the charts in the preceding 
-^^ chapter, the question naturally arises 
as to the ratio between the amount which is 
being accomplished now and what was ac- 
complished previous to the beginning of this 
work. 

In order to make these comparisons clear 
we devised a few years ago what we have 
called a ** Percentage Chart, '^ which com- 
pares all results with the conditions existing 
before the work was started. For instance, 
the standard production was called 100 per 
cent. Our new production may be two, three 
or four times that amount. The wages which 
were being paid before the work was started 
were also rated at 100 per cent. The new 
wages would be an increase over the old 
standard, usually of 30 to 50 per cent, and 
the wage cost measured in the same manner 
would be distinctly below the previous wage 
cost. 
Chart XIV is a chart of this character and 

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208 



EESULTS 209 

shows these ratios with regard to some work 
done several years ago in a bleachery in 
Ehode Island. Each of the vertical lines rep- 
resents a different kind of work. It will be 
noted that the various kinds are represented 
by the names at the top of these lines. The 
horizontal black lines marked **100 per cent'' 
represent the amount of work which was 
done on each of these operations previous to 
our investigations. The upper lines repre- 
sent the amount of work now being done, 
compared with what was previously done. 
The heavy black line marked ^^100 per cent" 
also represents the wages previously paid, 
and the dotted lines above it represent wages 
now paid. The 100 per cent line also repre- 
sents the previous wage cost. The dotted line 
below represents the present wage cost. 
Note that the increase in product is about 
200 per cent, and the decrease in wage cost 
is approximately 40 per cent, while the in- 
crease in wages is also 40 per cent. Bear 
in mind that this increase in product is due 
not solely to the work of the operative, but 
is much helped by more careful study and 
co-operation on the part of the management. 
It should be noted that this chart repre- 
sents four different classes of work, all of 



210 WORK^ WAGES, AND PROFITS 

which illustrate the effect of the task and 
bonus. In the last three cases the average 
output is in each instance more than double, 
and in one, the manufacture of pillow cases, 
more than three times as great. 

The increase in the case of the pillow-case 
factory was so great as to make some suspect 
that the work must have been done very in- 
efficiently before. This was undoubtedly 
true, but probably not more inefficiently than 
in many shops run by a foreman who has no 
special training as an executive, and of whom 
much more is expected than he could possibly 
do efficiently. 

But this is not all ; a fortunate set of con- 
ditions enabled us to get a measure of the 
improvement in quality which had been ob- 
tained. Soon after the reorganization of the 
pillow-case factory represented in Figure 4 
on this chart got well under way, there was 
a serious complaint of bad work from one 
of the largest customers. An investigation 
proved that the complaint was well founded, 
and the customer was asked to return all the 
goods. 

About fifty cases of goods were returned, 
and of course the bad work was all blamed 
on the new system. The inspection of the 



RESULTS 211 

first few cases proved that the number of 
imperfections per case varied greatly, and 
it was decided to keep an exact record of 
what the imperfections in each case were, 
and whether the work was done before or 
after the installation of the task and bonus 
system. The result was as follows: In 
twenty-eight cases of goods done before task 
work was started, the average number of im- 
perfections per case was 471/2. In two cases 
done after the task work was started, but be- 
fore the inspection was going properly, the 
average number of imperfections per case 
was 2. In eleven cases done under the task 
and bonus system, after the inspection was 
going properly, the number of imperfections 
per case was less than one. 

Eepresenting by unity in Figure 4 the 
number of imperfections per case before the 
task and bonus system was started, the short 
line represents the number afterward — less 
than 2 per cent. 

This improvement in quality also points to 
the fact that the pillow-case factory was 
badly run ; the interesting fact is that it was 
possible to make such a great improvement 
in a few weeks. 

The next question that naturally comes to 



212 -WORK, WAGES^ AND PROEITS 

one's mind is that of the permanence of these 
results. On this subject we have some data 
also. 

In 1904 we began the reorganization of a 
packing-box factory, which made five or six 
hundred cases per day and was run in con- 
nection with two large bleacheries of cotton 
cloth. This factory had been a sore spot, and 
whenever shipments were delayed the box 
factory came in for its share of the blame. 
It took nearly a year to get this factory into 
shape, but for the past nine years it has run 
so smoothly that the manager of the bleach- 
ery has hardly been aware of its existence. 
In 1912 this factory was running substan- 
tially as organized in 1904, with most of the 
original bonus workers still there. 

The organization of one of the bleacheries 
referred to was practically completed on 
these lines in 1907, and is running today 
better than it did then. The management of 
the other bleachery has been gradually re- 
modeled on the same lines. 

The management of the pad-ayeing depart- 
ment of a large dye works has been remod- 
eled on these lines, with the result of prac- 
tically doubling the output and distinctly 
improving the quality. The workmen are 



RESULTS 



213 



getting much better wages, and the costs are 
decidedly lower. This department has been 
running on these lines since 1909, and is run- 
ning much better today than at any time yet. 



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JOBS 

CHABT XV. WAGES AND PEODUCTION DIAGRAM ON SMALL 
AUTOMATIC SCREW-MACHINE WORK 

No better testimonial both to the quality of 
the work done and the economy with which 
it is being done can be had than the fact that, 
notwithstanding the increased output per ma- 
chine, they have been obliged to add other 
machines to the dye works to take care of 
the business offered, until they were doing 
in this department in 1910 nearly three times 
what they did in 1908. 

Chart XV represents similar results for 
work on small automatic screw-machines. In 
this case the light line represents the task, 



JOBS 



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220 
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CHABT XVI. WAGES AND PRODUCTION DIAGRAM ON LARGE 
AUTOMATIC MACHINE WORK 



214 



1 



RESULTS 215 

the upper heavy line representing tlie amount 
of work done. The upper dashed line repre- 
sents the wages now being received, and the 
lower dashed line represents the new wage 
cost. In this particular case the shop was 
very well run before we undertook to study 
the work, and the workmen were getting very 
good wages. It will be seen that the increase 
in production is not quite so high as in the 
former chart, nor is the increase in wages 
quite so great. 

Chart XVI shows similar results for large 
automatic machines. 

Chart XVII represents the same change 
for miscellaneous machine-work in a plant 
manufacturing a small article in quantities. 

Comparing all four of these charts, it will 
be evident that there is a very striking simi- 
larity whether we are doing hand work in a 
bleachery, or automatic lathe work in a ma- 
chine shop. If the management assumes its 
share of responsibility in preparing the 
work, in seeing that the machines are in 
proper condition, and in training the work- 
men, we can get from two to three times as 
much work done as is usually done, pay 20 
to 50 per cent increase in wages, and still 
save about 40 per cent in wage cost. 



216 WOEK^ WAGES^ AND PROFITS 

Of course it will be realized that this in- 
crease in output brings down the overhead 
expense on every unit of product, so that the 
decrease in wage cost is not the only impor- 
tant item. Indeed, it is not even the most im- 
portant. Unless the total overhead expense 
is markedly increased when the product is 
increased, this expense per unit of product 
comes down substantially in inverse ratio to 
the amount by which the product goes up. 
The reduction in cost from this source is 
usually markedly greater in dollars and cents 
than the reduction in w^age cost. This side 
of the cost question has usually been given 
too little consideration. Mr. Andrew Carne- 
gie was among the first men in the United 
States to recognize the great value of getting 
a larger product from his plants, and this 
fact, perhaps more than any other, gave him 
the mastery of the steel business. Many 
times we can afford to pay even a higher 
wage per piece if thereby we can reduce this 
overhead expense. In general, however, a 
thorough study of the work enables us to 
reduce both wage cost and overhead expense 
per unit of product, at the same time sub- 
stantially increasing the earnings of the 
workman. 



RESULTS 



317 



On Chart XVII some reader may note at 
once tlie discrepancy between the task set 
and the amount of work performed in cer- 
tain cases, showing that the workman did a 
great deal more than it was expected he 



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iMIS.CJlLLANEO.US MACHINE WORK JOBS 



CHART XVII. WAGES AND PRODUCTION DIAGRAM ON 
SMALL MISCELLANEOUS MACHINE WORK 



218 WOEK^ WAGES^ AND PROFITS 

would do. It may be asked, naturally, how 
we could overcome tMs difficulty, for many 
people feel at once that a serious mistake 
has been made and that the tasks should be 
increased or the rates reduced. 

In reply to this I have to say that these 
tasks were set by a task-setter who had not 
had sufficient experience and that he has 
much improved since the setting of these 
tasks. We, however, do not consider that 
because he has made an error it is neces- 
sary to change the rates. As a matter of 
fact, we rather prefer that there should be 
a few easy tasks so that the workmen may 
have a practical demonstration of the fact 
that we are not going to cut rates and that 
they need have no fear whatever if they do 
all the work they can and earn all the money 
possible. 

After seeing these charts the comment of 
some, at least of those who study them, will 
be that these shops must certainly have been 
run very badly before. As a matter of fact, 
that is not so. "While some perhaps were not 
in the class of well-run shops, others were 
not only in this class, but high up in the class. 
Before the introduction of these methods the 
results that were achieved were due to the 



RESULTS 219 

effort the workman put into his work, with 
practically but little direct assistance from 
those over him. After the methods were in- 
stalled he was taught the best way of doing 
the work that we could devise, offered a sub- 
stantial reward for accomplishing the desired 
results in the manner in which he had been 
taught, and the conditions under which he 
was working were so modified that these re- 
sults could be accomplished if the worker 
were properly trained. In other words, these 
results are not accomplished hy the work- 
man alone and unaided. He must have the 
thorough co-operation of a strong manage- 
ment. 

Another criticism may be that this applies 
to what might be called direct labor, and that 
no account is taken of the indirect labor, such 
as transportation, clerical work, etc. 

In reply to this criticism I reply that 
we find, as a rule, that there has been even 
less attention given to the proper study and 
planning of indirect labor, and that the 
chance for improvement in that line is quite 
as great as, if not greater than, in the line 
of direct labor. The clerical work is fre- 
quently the most inefficient of all in the fac- 
tory. 



220 WORK^ WAGES^ AND PROFITS 

My object in presenting so many charts il- 
lustrating the same thing is to show to as 
great an extent as possible that the prin- 
ciples laid down in this discussion are of 
wide application, and that in all cases sub- 
stantial results may be expected, if these 
principles are properly carried out. 

The essential point in carrying out these 
ideas properly is that they should be under- 
stood and thoroughly appreciated by the 
people who undertake their application. The 
results shown cannot be accomplished unless 
we have harmonious co-operation between 
employer and employee, which is impossible 
under any form of management that as- 
sumes that the responsibility of the manager 
has ended when he has issued his orders to 
the shop. 

To my mind, the training of workmen to 
fill all the different positions in a factory is 
one of the important functions of the man- 
agement, and we all know that training is 
slow and expensive ; but it is the only method 
which holds out any hope of producing even 
a partial solution of our present industrial 
problems. 

While this discussion is of importance to 
the man considering the adoption of these 



RESULTS 221 

metliods, tlie most important fact for people 
in general is that our immigrants as well as 
our native people can be trained to habits of 
industry and made efficient, and that a 
scheme of co-operation can be devised that 
is beneficial alike to employer and employee. 
Further, it is of importance that when once 
in operation these methods are continued and 
perfected by the workers themselves. 

If these methods were introduced exten- 
sively, it is without question that the habit 
of the shop would influence that of the com- 
munity, and there would be a general in- 
crease in efficiency. The habits a man has to 
acquire to become efficient in one class of 
work stand him in good stead in becoming 
efficient in other work. These habits of work 
are vastly more important than the work 
itself, for it is our experience that a man who 
has become efficient in one thing readily 
learns to become efficient at doing other 
things. The ability of such people to pro- 
duce wealth is more to the country than the 
wealth itself. The productive power is more 
valuable than the product. Many of the 
workers represented on our charts are im- 
migrants who cannot speak English, yet in a 
few months at most they become far more 



222 WORK, WAGES, AND PROFITS 

efficient than the average mill operative, who 
professes to be skilled. 

It must be emphasized, however, that this 
training was done only by the very best 
workers nnder the direction of good teachers, 
that the individual was given the personal 
attention, day after day, of the teacher and 
the expert workman, and that he was assured 
of good compensation if he succeeded. "We 
concentrate on the individual, but when a 
few have learned, and are being benefited, 
others are not slow to imitate. One cannot 
learn to do this work by reading magazine 
articles ; it must be learned in the shop where 
an educated man studies the work and the 
workmen. When he has become familiar 
with both work and workmen he can make 
a start, but to try to do much without this 
kind of practical experience is about as futile 
as trying to learn to skate through a corre- 
spondence school. 

To succeed in this work the teacher must 
have the ability to analyze and investigate, 
and must himself be trained in such habits 
of industry and concentration as to enable 
him to become master of his subject. 

In his inaugural address, President Low- 
ell, of Harvard University, emphasized the 



RESULTS 223 

importance of hard and accurate thought in 
the following words : 

^'The student ought to be trained to hard 
and accurate thought, and this will not come 
from surveying the principles of many sub- 
jects. It requires a mastery of something 
acquired by continuous application/' 

If we substitute for ^^hard and accurate 
thought/^ hard and accurate work, his re- 
marks are just as true when applied to the 
workman as to the student. The workman 
who has become master of something takes 
pride in his work and soon distinctly im- 
proves in personal appearance. The im- 
provement is so universal and so marked 
as to be always distinctly recognizable, and 
is much more than can be accounted for by 
the increase in wages which enables him to 
dress better. 

This improvement is even more marked in 
girls than in men, for the girls invariably ac- 
quire a better color and improve in health. 
In one case the girl bonus workers formed a 
society and adopted a badge which they all 
wore. Only those who could earn their 
bonus were eligible. This incident is a little 
thing in itself, but it shows the feeling that 
comes with mastery of some subject. They 



334 WOEK^ WAGES, AND PROFITS 

know what they can do and are proud of it. 
This consciousness of efficiency, this knowl- 
edge that they have succeeded and can do it 
again, puts the worker in a very different 
class from those who go along day after day 
watching the clock and doing just enough 
not to get discharged. 

The task gives the worker a definite object 
to strive for, causes a certain amount of 
mental exhilaration, and invariably increases 
the keenness of the perceptions. 

From our task workers we frequently get 
instructors and sometimes investigators. 
From our investigators and instructors we 
get an ample supply of superintendents and 
foremen. The foremen and superintendents 
trained under this system have proved far 
more successful than any it was possible to 
hire. 



I 



PEICES AND PEOFITS 



Chapter XI 
PEICES AND PROFITS 

ABOUT 1890 the financiers of the United 
States discovered a new and seemingly 
a very important principle. They realized 
that, in many cases, at least, the larger fac- 
tories were making a larger percentage of 
profit than small ones, and conceived the idea 
of uniting the small ones under one system 
of management. By this move, they cer- 
tainly did give the small factories a better 
financial standing, at the same time reducing 
what might be called the financial or business 
expense. 

By this they also reduced competition and 
decreased the cost of selling, which has al- 
ways been a large element of expense. Un- 
der these conditions, business prospered 
rapidly, for there was, in many cases, un- 
doubtedly a reduction in cost. The illus- 
trated magazines were filled with the pic- 
tures of the captains of industry who had 
engineered these combinations, and it was 
freely predicted that the economies to be ob- 

227 



228 WO-RK, WAGES, AND PROFITS 

tained were so great that it would only be a 
question of time before Europe would be 
flooded with American goods. 

Magazine articles of this character were 
extremely popular for three or four years, 
and the formation of consolidations or trusts 
in manufacturing, and of great systems in 
railroading, went on at a rapid rate. The 
economies that had been produced by these 
methods, together with the fact that, with 
the elimination of competition, the selling 
price had been upheld, enabled many such 
combinations to pay dividends on stock 
which had originally represented little or no 
value. 

The unprecedented prosperity that fol- 
lowed the introduction of these methods was 
undoubtedly caused in a large measure by 
them, and the financier was justly regarded 
as having done much to promote the pros- 
perity of the country. Our internal trade 
grew at an astounding rate, but the Amer- 
ican invasion of Europe did not materialize ; 
and it was not very long before we began to 
hear complaints of the increasing inefficiency 
of labor. Wages began to rise, but the out- 
put of the workmen did not rise correspond- 
ingly. The financier had undoubtedly ef- 



PRICES AND PROFITS 229' 

fected economies on those portions of busi- 
ness directly under his control, but had not 
succeeded equally in those with which he did 
not come in direct contact. 

As a matter of fact, while the financier had 
been forming his great combinations of 
manufacturing interests and railroads, with 
the effect, at least, as far as the public is 
concerned, of upholding prices, the workmen 
had gone him one better. By their Unions 
not only have they upheld the price of their 
labor, but in many cases markedly increased 
it, without rendering any more service than 
formerly; the employers, in many cases, say 
less. 

Under these conditions, the projected in- 
vasion of Europe seems to be postponed in- 
definitely, and the continually increasing cost 
of living in this country seems to indicate 
that we need something more than able finan- 
ciering to round out our theory of industrial 
economy. While this fact is recognized by 
all, it is not so easy to specify exactly what 
is wrong and how it is to be corrected. Co- 
operation among employers to uphold the 
price of their product has been so successful 
that it is scarcely to be wondered at that 
the workmen should adopt the same tactics. 



230 WORK^ WAGES^ AND PROFITS 

On this subject Adam Smith, in his famous 
book on **An Inquiry into the Nature and 
Causes of the Wealth of Nations," nearly 
one hundred and forty years ago wrote as 
follows : 

Our merchants and master-manufacturers com- 
plain much of the bad effects of high wages in rais- 
ing the price and thereby lessening the sale of goods 
at home and abroad. They say nothing of the bad 
effects of high profits. They are silent with regard 
to the pernicious effect of their own gains. They 
complain only of those of other people. 

This statement made so long ago is just 
as applicable to the conditions of today, and 
admonishes us in approaching our problem 
to do so with an open mind, and not from a 
partisan standpoint, for a solution cannot be 
permanent if it benefits one class exclusively. 
Any scheme for the utilization of the ener- 
gies of the community for the benefit of one 
class of people only would soon destroy de- 
mocracy, and develop an oligarchy, which 
would he ultimately overturned by revolu- 
tion. 

Inasmuch as the object of manufacturing 
or any kind of industry is to make profits, it 
is only natural that the part that seemed to 
yield large profits readily should have been 
exploited first. 



PRICES AND PROFITS 231 

As business increases in volume, profits 
will normally increase correspondingly; but 
there are only two ways of substantially in- 
creasing the profits per unit of output — one 
by increasing the selling price, the other by 
reducing the cost of production. 

Inasmuch as increase of selling price 
yields more prompt returns, and returns that 
can be measured with great accuracy, much 
of the talent of our manufacturers has been 
engaged in this branch of the business. The 
successful salesman, or the operator who has 
succeeded in persuading his competitors to 
join with him in upholding or advancing 
prices, on account of the increased profits 
resulting from his efforts has been consid- 
ered a very important man and compensated 
accordingly. The recognition of ability, and 
the compensation for success in this field, 
have been so great that capable workers 
from all directions have swarmed into it, 
and the industry of making prices has pros- 
pered amazingly, to the comparative neglect, 
often, of the production end of business. 

With increase of prices comes higher cost 
of living; with higher cost of living comes 
demand for higher wages; with higher 
wages (unless accompanied by greater effi- 



232 wouKj wages^ and profits 

ciency) comes liiglier cost of production. 
Then, to maintain the same profit under the 
new conditions, we must again increase our 
selling price, and the cycle repeats itself. 
This process has been going on for years, 
and the producers have been gradually at- 
tracted from the field of making products to 
the more lucrative one of making prices. 

Let us now consider the other alternative 
— that of reducing cost — and ask why more 
attention has not been paid to it, and what 
we may expect to get if we cultivate this 
field as assiduously as we have done the first. 

The first cause of the small interest 
hitherto shown in the effort to improve pro- 
duction is that there is still a lingering feel- 
ing among many prominent people that the 
shop worker is not entitled to the same de- 
gree of consideration as the office worker; 
and this work cannot be done in the office. It 
must be done amid dirt, dust and the noise 
of machinery. It must be done by not only 
studying individually the machines that do 
the work; but by also studying individually 
the men that operate them. This is work 
that requires ability quite as great as, if not 
greater than, that needed for the making of 
prices ; it also requires long hours and over- 



PEICES AND PROFITS 233 

alls; and the compensation for success in 
this line does not compare with that accorded 
the man who adds to the bank account by get- 
ting a higher selling price. 

On account of these conditions the effect- 
ing of economies in factories is usually left 
to the partially educated mechanic or clerk, 
who, whatever his success, seldom gets an 
adequate reward. When the compensation 
for success in this latter branch is made 
commensurate with that in the former, and 
then only, will it attract and hold educated 
men, to whom we must look for the success 
in any work requiring study or investigation. 
Study of men and processes is difficult, and 
we have done but little in this country to en- 
courage it; but the time has come when we 
must turn our attention to it at once, for the 
combination of the high cost of living, and 
the inefficiency of production in almost all 
lines, is rapidly producing a condition of 
which no one can foresee the result. 

The horizontal increase of wages being 
granted by so many corporations throughout 
the United States is not a cure, but an ex- 
pedient only to enable the workmen to sup- 
ply themselves for the present with a larger 
proportion of the necessities of life. Such a 



234 WOKK^ WAGES, AND PEOFITS 

sclieme provides temporary relief only, for 
a general increase of wages increases costs 
again; and, if sucli a policy is followed, it 
will not be long before a new increase of 
wages will be needed to meet the continually 
rising cost of living. 

No scheme therefore which confines itself 
to pa^dng high wages offers any solution. 
In fact there seems no solution as long as 
selling price is fixed by agreement and not 
by value. When, however, ^'conspiracies for 
the restraint of trade,'' as such agreements 
are called, are eliminated, a policy of in- 
creasing the efficiency of the producer and 
hence reducing costs, under a national sys- 
tem of competition, will have the desired 
result. This is not an easy problem; and 
there is no royal road to the desired end, for, 
as was said before, it means long hours and 
overalls, and the ability to study men and 
machines in the surroundings of dirt, dust 
and noise. 

As was said before, also, this work does 
not attract many educated or capable men, 
because the compensation for success is so 
meager ; but the time is rapidly approaching 
when the men that can do this work well will 
be in demand at almost any price. This is 



PRICES AND PROFITS 235 

peculiarly the Avork of the mechanical en- 
gineer, and manufacturers who realize this 
fact and take advantage of it will be sur- 
prised at the benefits they obtain. 

It is an economic law that large profits can 
be permanently secured only by efficient op- 
eration ; and any man, or body of men, that 
exacts a compensation out of proportion to 
the service rendered will ultimately come to 
grief. The supreme importance of efficiency 
as an economic factor was first realized by 
the Germans, and it is this fact that has en- 
abled them to advance their industrial con- 
dition, which twenty years ago was a jest, 
to the first place in Europe, if not in the 
world. We naturally want to know in detail 
the methods they have used; and the reply 
is that they have recognized the value of the 
scientifically trained engineer as an economic 
factor. 

In the United States, superb natural re- 
sources have enabled us to make phenomenal 
progress without much regard to the teach- 
ings of science, and in many cases in spite 
of our neglect of them. The progress of 
Germany warns us that we have now reached 
the point where we must recognize that the 
proper application of science to industry is 



236 WORK, WAGES^ AND PROFITS 

of vital importance to the future prosperity 
of the country. 

Many of our most prominent men, and men 
of most influence in the country, received 
their college training before the possibility 
of such a condition was even hinted at; and 
hence they fail to realize its seriousness. 
Our universities and schools of higher learn- 
ing are still in many cases dominated by 
those whose training was largely literary or 
classical, and they utterly fail to realize the 
difference between a classical and an indus- 
trial age. This difference is not sentimental, 
but real ; for that nation which is industrially 
most efficient will soon become the richest 
and most powerful. 

If we wish to hold our place in the proces- 
sion we must at once accord the scientist the 
place he is entitled to, and we must recog- 
nize his work, and that of the engineer, by 
such financial compensation as will attract 
our best men. 

A few years ago efficiency in the United 
States was a local question; today it is a 
national question, and co-operation for its 
promotion will not only be of great perma- 
nent benefit to those co-operating, but will 
have a great educational effect on the nation. 



PRICES AND PROFITS 237 

Co-operation to uphold or to raise prices 
is seen on all sides ; bnt it is difficult to find 
a single case where there has been any seri- 
ous attempt at co-operation to study econ- 
omies, and to inaugurate them effectively. 
Systematic work in this line would do more 
to increase prosperity, and to reduce costs, 
than all other influences combined; and re- 
duced selling prices might be made without 
decreasing profits. 

Moreover, if it should become the fashion 
to co-operate for the effecting of economies, 
instead of for raising prices, we should not 
need so much new legislation to restrain the 
activities of some of our most enterprising 
citizens. 

Although the application of the scientific 
method to the larger problems of engineer- 
ing and manufacture has been most rapid 
within recent years, and the great advances 
made testify to its success, its application to 
the innumerable small details of work has 
been largely neglected. These details have 
been regarded as being in the domain of 
trades rather than of engineering, and have 
been left to the mechanic. Inasmuch as me- 
chanics, as a class, get but little benefit from 
the development of a better method, or a 



238 WORK, WAGES, AND PROFITS 

labor-saving process, they are as a rule little 
interested in such improvements. It is not 
surprising, therefore, that labor unions 
should offer a distinct opposition to such im- 
provements, and that workers trained in the 
atmosphere of the union should consider it 
their duty to perpetuate this hostility. To 
avert this hostility we must begin by giving 
workmen a different training. 

Before the advent of the modern factory 
system, each master workman owned his 
little shop, which he ran with the assistance 
of two or three journeymen, and in which 
he personally superintended the training of 
his apprentices. In training apprentices, his 
first object was to provide himself with ca- 
pable journeymen; but he also realized that 
the best way to increase his reputation was 
to send forth men that should be a credit to 
him. He was therefore doubly particular 
that no one should leave his shop who was 
not able to do his work well. 

With the coming of the factory system, the 
owner became too busy to give much per- 
sonal attention to the apprentices, and, as the 
factories grew larger, he was often unable 
to take from the business end enough time 
to make himself even a master workman in 



PRICES AND PROFITS 239 

all branches of Ms work. With the increas- 
ing size of the factory the superintendent 
also became too busy to give much personal 
attention to the apprentices, and they were 
thus left to receive their training from the 
foreman and their fellow-workmen, who, as 
a rule, have no financial interest in training 
additional men, who may, in time, become 
their competitors. This is undoubtedly the 
most important reason why the old appren- 
tice system has gradually become less effec- 
tive, until today it is almost obsolete. It is 
also a good reason why an attempt to revive 
it in its old form is foredoomed to failure. 
The principles on which the old appren- 
ticeship system was founded are sound — 
namely, that the success of the pupil should 
add to the reputation and financial better- 
ment of the teacher and pupil both. It would 
seem, then, that if our modern methods have 
a similar foundation they also will be suc- 
cessful. Moreover, if the training is based 
on the results of scientific investigation, and 
the methods employed are those which em- 
body our best knowledge on the subject of 
teaching, we should be able, not only to pro- 
vide ourselves with an abundance of skilled 
workmen who are capable of doing well the 



240 WORK^ WAGES^ AND PROFITS 

tasks set them, but to develop many who are 
able to advance the mechanic arts in a man- 
ner superior to that which gave the New 
England master workman of a generation 
ago such a wide reputation. 

There is really no sharp line between me- 
chanical engineering and trades. Wherever 
there is a problem to be solved, no matter 
how small or common-place, there is work 
for the educated man; and his solution by 
the scientific method is, as a rule, so much 
better than that of the mechanic without 
scientific knowledge, that workmen trained 
in the light of such a solution are far more 
efficient than those trained by mechanics in 
their methods. The increased efficiency of 
such men entitles them to increased compen- 
sation; and, by awarding that compensation 
in a proper manner, I have never failed to 
secure the hearty co-operation of the good 
men. A system of management based on 
these methods is just as much a part of our 
assets as plant, or equipment. 

We are all familiar with plants that were 
failures under one manager and successes 
under another, or vice versa; but so far no 
satisfactory method is generally known by 
which a system of management can be put 



PRICES AND PROFITS 241 

into such a shape as to be self -perpetuating. 
This is exactly what the methods described 
in preceding chapters do accomplish, at least 
to a large extent. The importance of this 
fact is second only to that of one other, 
namely, that they do actually get the highest 
possible efficiency. 

The reason our methods are permanent is 
that it is to the financial interest of both 
workman and foreman to maintain them. 
Systems which are maintained in their effi- 
ciency by the higher officers are liable to 
deteriorate when such officers become old, or 
are replaced. The system I have described 
not only makes for the highest efficiency, but 
is practically self -perpetuating, for the train- 
ing the men receive fits each to fill a higher 
position. 

In considering in detail the elements that 
affect cost of manufacture and, through 
them, profits, most people place them in three 
classes : — 

Wages, 

Materials, 

Overhead expense. 

In the third class they include all the vari- 
ous items of expense that cannot be charged 
up directly to manufacturing, such as rent. 



342 wore:, wages^ And profits 

taxes, insurance, salaries, selling expenses, 
depreciation, power, light, heat, etc. These 
items, taken together, often amount to more 
than the wages paid for doing the work. 
This class of expense is very important, for 
it goes on with but little change day after 
day, whether we do much work or little, and 
it must be added to the cost of the output, 
month by month. If the output is small, 
this burden of expense per unit of output is 
large; on the other hand, if the output is 
large this expense per unit is correspond- 
ingly less. 

Andrew Carnegie was one of the first men 
to appreciate to what extent this was a fact, 
and, by making good use of it, he laid the 
foundation for the practical control of the 
steel industry. 

If the output of a plant is doubled, the 
overhead expense per unit of product is very 
nearly cut in half. If at the same time we 
reduce the wage cost 40 per cent and double 
production, as we have shown can so often 
be done, the profits mount at a very rapid 
rate. 

In order to illustrate these points, let us 
assume a hypothetical case in which we are 
making a profit of 10 per cent on the cost 



I 



PRICES AND PROFITS 243 

of our products, our expenses for one week 
being divided as assumed in the following 
table, which is closely in accord with prob- 
abilities : — 

Material $3,000 

Wages 1,000 

Expense Burden 1,000 

$5,000 
Selling Price 5,500 

Profit $500—10 per cent of cost 

Suppose now we wish to double our 
product. The usual method is to double the 
size of the plant without increasing the effi- 
ciency of operation. In this case all ex- 
penses will be doubled, except the expense 
burden, which will be very nearly doubled, 
and our case may be approximately repre- 
sented by the following figures : — 

Material $6,000 

Wages 2,000 

Expense Burden 1,800 

$9,800 
Selling Price 11,000 

Profit $1,200—12 per cent of cost 



244 WORK^ WAGES^ AND PEOFITS 

Suppose, on the other hand, we double our 
product by increasing the efficiency of opera- 
tion, as we have shown can often be done, 
without increasing the size of the plant or 
the number of workmen. The following fig- 
ures will be fairly representative : — 

Material $6,000 

Wages 1,400 

Expense Burden 1,200 

$8,600 
Selling Price 11,000 

Profit $2,400—28 per cent of cost 

The profit is nearly five times as great as 
in the first case, and twice as great as in the 
second. In the second case we have twice 
as much money invested in the plant as in 
the first and third cases. But in the third 
case, where we have increased efficiency and 
reduced costs, the profit on invested capital 
is nearly five times that in either of the first 
two cases. 

While these figures are hypothetical, and 
are not applicable to all industries, they are 
conservative, as they represent a decrease in 
total cost of only 14 per cent, as may be seen 
by comparing $5,000, the cost in the first 
case, with $8,600, the cost of double the 



PRICES AKD PROFITS 245 

products in the last case. To get a similar 
increase of profit by increasing the selling 
price without enlarging the plant or in- 
creasing efficiency, we should have been 
obliged to sell goods that cost us $5,000 for 
$7,400, or at a profit of nearly 50 per cent. 
Such an increase in selling price would sim- 
ply be an invitation to other competitors to 
come into the field. If such a competitor 
should operate as efficiently as we have as- 
sumed to be possible in our third case, and 
competition should force the price down, he 
could sell his goods for less than our original 
cost and still make a profit of 15 per cent. 

If manufacturers in general realized how 
much an increase in efficient operation really 
meant to them, they would be very slow to 
increase the size of a plant until they had be- 
come pretty well convinced that they had 
gotten it up to its maximum efficiency. 

What has been said of the manufacturer 
is true of that greatest of producers, the 
farmer, as well ; but we must not expect him 
to understand what the more favored manu- 
facturer so often fails to appreciate, namely, 
that efficient operation of a small plant, or 
farm, is more profitable than the slack op- 
eration of a large one. 



246 WORK^ WAGES^ AND PROFITS 

If the same intelligence and industry had 
been applied generally to the art of produc- 
tion as have been exercised in selling prod- 
ucts, I can hardly help feeling that we should 
be suffering less acutely today from high 
prices. In the long run prices are governed 
by supply and demand. When it comes to be 
generally realized that efficient production 
and a large, cheap, product form a more sta- 
ble basis for profits than a small, expensive 
one, because they form a more stable basis 
for prosperity, we may hope that some of the 
talent that has been exploiting the over- 
worked field of making prices will return to 
the comparatively fallow field of making 
products. 

I do not wish to be understood as intimat- 
ing that nothing has been done in this field. 
Much has been done, especially in the steel 
industry ; but it is a mere drop in the bucket, 
when compared with what still remains to be 
done in almost all productive industries. 
The steel industry was one of the first to 
utilize educated engineers, and to study the 
methods of efficient operation. The fact that 
steel products brought high prices has never 
stood in the way of reducing cost ; and today, 
thanks to this policy, American steel makers 
can compete with any in the world. 



PRICES AND PROFITS 247 

If the mucli boasted superiority of the 
American people is really a fact, and the 
phenomenal progress of the past is really 
due to the ability of the people of the United 
States and not mainly to splendid natural 
resources, we should rise to the occasion, and 
become the example for others to point to. 
This cannot be done by making prices ; and a 
tariff that is so high as to enable profits to 
be made regardless of cost is not a protec- 
tion, but a decided detriment to the country. 
A tariff that encourages efficiency is more 
to be desired than that which will enable its 
beneficiaries to accumulate wealth, for any 
prosperity not based on efficiency is on an 
unstable foundation. 

In order to bring the efficiency of opera- 
tion up to the point we have shown to be 
possible, we must first have absolute control 
of the materials we use and the tools we 
work with. In other words, we must see 
that the proper materials are always ready, 
and that proper tools for doing the work are 
available. This is a function of the manage- 
ment, and not of the workmen, and necessi- 
tates the keeping of an exact record of the 
materials used. Inasmuch as material repre- 
sents money, any attempt to keep an exact 
record of it, and of where and how waste 



248 WORK^ WAGES, AND PROFITS 

occurs, results at once in a saving far in ex- 
cess of the cost of keeping the records. 

When therefore we begin to install a sys- 
tem of management on the lines indicated, 
nearly every step produces a saving; but, as 
many concerns have no records that show 
leaks and losses of material, it is usually 
difficult to show what has been saved by 
stopping such losses. Again, when we begin 
to put machinery in condition to enable us 
to run it at its proper efficiency, and to en- 
able each man to do a proper day's work, the 
expense incurred to accomplish this end is 
usually charged against the ^^new system," 
whereas it should he charged against the sys- 
tem that put the machinery/ out of condition. 

Inasmuch as in any change in management 
the mechanism of the old system must not be 
disturbed until that of the new system is 
working smoothly, there is always some time 
when we must practically run two systems. 
From these considerations it is evident that, 
no matter how much we may be able to in- 
crease the profits in the long run, we must 
not expect results to show in the form of 
profits at once. 

The total cost of making the change from 
the old system to the new is not greatly dif- 



PRICES AND PROFITS 249 

ferent, whether it be done quickly or slowly. 
If it is done quickly, the benefits are gotten 
that much sooner ; but the expense is concen- 
trated in a short time, and, unless this fact is 
realized from the start, it is apt to cause a 
certain amount of hesitation at the very time 
when the work should be pushed fastest. If 
the plant is a large one, or one doing a large 
variety of work, the advantages of control- 
ling the material, planning the work, and 
increasing the efficiency of the individual are 
so great that a little done in this direction 
soon makes itself felt, for the plant begins 
to run more smoothly, wastes diminish, and 
profits begin to increase, and we are on the 
road to our ideal, a self-perpetuating system 
of management based on the efficient utiliza- 
tion of scientific knowledge. 

Such a system seems Utopian. Perhaps 
it is, but we have seen the possibilities of it 
so clearly, and have in actual operation ap- 
proximations to it so close, that we are pre- 
pared to see its realization in the near 
future. Under such a system in its best de- 
velopment we have co-operation like that in 
a foot-ball team, or an orchestra, where each 
man has assigned to him the part he can do 
best, and where he does it with pride and joy 



250 WORK^ WAGES^ AND PROFITS 

to the best of Ms ability. The organization 
of such a system must be perfected by men 
familiar with the industries and trained in 
the methods of scientific investigation. The 
graduates of our engineering schools are the 
men on whose shoulders this problem natur- 
ally falls, and if they are capable of handling 
it, they will gain for the profession of en- 
gineering the recognition to which it is al- 
ready entitled, as the most important factor 
in modern civilization. 



A PEACTICAL EXAMPLE 



Chapter XII 

A PKACTICAL EXAMPLE 

^T^HIS chapter has been called '^A Prac- 
-*- tical Example'' for want of a better 
term. It is in reality an attempt to summa- 
rize the contents of this book and to illustrate 
more specifically how the principles outlined 
in the previous chapters are carried out. In 
such an attempt there must necessarily be 
many repetitions of what has previously 
been said. The repetition which is most pro- 
nounced is the one concerning the man rec- 
ord, the usefulness of which has been appre- 
ciated by but few people. In Chapter IV, 
on ^^Day Work," this subject is discussed 
and a form shown, headed '* Machine Eec- 
ord." This particular form is used where 
the man in question is working continuously 
on one machine, in which case the man rec- 
ord and the machine record are identical. 
Inasmuch as our first object is always to 
train people to utilize all the knowledge that 
we have, it is essential that we should have 
some measure of the individual to find out 

253 



254 WORK, WAGES, AND PEOriTS 

whether lie is responding to our e:fforts or 
not. Previous to the time of the setting of a 
task the man record has been our best in- 
strument for this purpose. 

The task and bonus system was introduced 
by me in the Bethlehem Steel works in 1901, 
as a means of affording substantial justice to 
the employee, while requiring him to conform 
to the best interests of his employer. The 
employee was not told in a general way 'Ho 
do better/' tut had a definite standard set 
for him, and was shown how to reach that 
standard, for which he was awarded com- 
pensation in addition to his usual day's pay. 

The system may be described in a general 
way as follows: A card is made out show- 
ing in detail the best method we can devise 
of performing each of the elementary opera- 
tions on any piece of work, specifying the 
tools to be used, and setting the time needed 
for each of these operations as determined 
by experiments. The sum of these times is 
the total time allowed to complete the piece 
of work. If a man follows his instructions, 
and accomplishes all the work laid out for 
him as constituting his proper task for the 
day, he is paid a specified bonus, in addition 



A PRACTICAL EXAMPLE 255 

to his day rate, which he always gets. If, 
however, at the end of the day, he has failed 
to accomplish all the work laid out, he does 
not get his bonus, but simply his day rate. 
As the time for each detail operation is 
stated on the instruction card, the workman 
can continually see whether he is earning 
his bonus or not. If he finds any operation 
which he cannot do in the time set, he must 
at once report to his foreman, who must 
show him how to do it, or report to the man 
who made out the instruction card. If the 
latter has made an error, he must make out 
a new instruction card, explaining the proper 
method of working, and allowing the proper 
time. If, however, the instructor contends 
that the work can be done in the time set, he 
must show the workmen how to do it. 

The preferred way of paying the bonus is 
as extra time, figured as a percentage of the 
time allowed, usually betwen 25 per cent and 
50 per cent. 

It is of the greatest possible importance 
that errors in making out instruction cards 
should be as few as possible. A man must 
be allowed time only for what is stated on 
his card; and, while a reasonable time must 
be allowed for each operation, he should fail 



256 WORK^ WAGES^ AND PROFITS 

to receive his bonus if time is lost from any 
cause whatever. (The foremen also receive, 
in addition to their day wages, compensation 
proportional to the number of their men who 
earn a bonus, and an extra compensation 
if all earn bonuses.) 

As these cards are made out by a skilful 
man, with records of investigations at hand, 
they invariably prescribe a better method 
for doing the work than the ordinary work- 
man, or foreman, could devise on the spur 
of the moment. As all the appliances and 
instructions necessary for doing the work 
are furnished, and a bonus is allowed the 
workman in addition to his regular rate if 
the work is done satisfactorily in the time 
set, it will be seen at once that this method is 
really a system of education ivith prizes for 
those who learn. The results obtained bear 
out this idea of education most fully, for 
under this plan men have learned more in 
a few months than the same men ever did 
before in years. 

SCIENTIFIC METHOD 

In order to get the information needed to 
make good instruction cards, a very large 
amount of detail work is necessary. When 



A PRACTICAL EXAMPLE 257 

we realize, however, that any operation, no 
matter how complicated, can be resolved into 
a series of simple operations, we have 
grasped the key to the solution of many prob- 
lems. Further study leads us to the con- 
clusion that many different complicated op- 
erations are composed of a number of the 
same simple operations performed in dif- 
ferent orders, and that the number of ele- 
mentary operations is frequently smaller 
than the number of complicated operations 
of which they form the parts, just as the 
number of letters in the alphabet is smaller 
than the number of words in the language. 
The logical method, therefore, of studying a 
complicated operation is undoubtedly to 
study the simple operations of which it is 
composed; a thorough knowledge of these 
will always throw a great deal of light on the 
complex operation. In other words, the time 
needed for performing any complex opera- 
tion must necessarily depend upon the time 
and method of performing the simple opera- 
tions of which it is composed. The natural 
method, then, of informing ourselves about 
a complex operation is to study its compo- 
nent elementary operations. Such study 
divides itself into three parts, as follows : 



258 WORK^ WAGES, AND PROFITS 

An analysis of the operation into its ele- 
ments. 

A study of these elements separately. 

A synthesis, or putting together the results 
of our study. 

This is recognized at once as simply the 
ordinary scientific method of procedure fol- 
lowed whenever it is desired to make any 
kind of investigation; and it is well known 
to all that until this method was known and 
adopted, science made practically no pro- 
gress. I believe that, if it is desired to obtain 
the correct solution of any problem, we must 
follow the well beaten paths of scientific in- 
vestigation, which alone have led to reliable 
results. The ordinary man, whether me- 
chanic or laborer, if not instructed, but left 
to himself, seldom performs any operation 
in the manner most economical either of time 
or labor. It has been conclusively proven 
that, even on ordinary day work, a very de- 
cided advantage can be gained by instructing 
the men how best to perform the work they 
are set to do. When these instructions are 
the result of scientific investigation, and a 
liberal reward is given for following them, 
the gain in efficiency is usually beyond our 
highest expectations. 



A PRACTICAL EXAMPLE 359 

It is perfectly well known that nearly 
every operation can be, and in actual work 
is, performed in a number of different ways ; 
but it is self-evident that these ways are not 
all equally efficient. As a rule some of the 
methods employed are so obviously ineffi- 
cient that they may be discarded at once, 
but it is often a problem of considerable diffi- 
culty to find out the very best method, and 
it is only by a scientific investigation of each 
of the elements that we can hope to arrive 
at even an approximate solution. 

INSTRUCTIOlSr CARDS AND PIECE RATES 

When a piece rate is made out for any kind 
of work with which the men are not thor- 
oughly familiar, it is obviously only simple 
justice to them that they should have detailed 
instructions how to accomplish each of the 
elements of the work in the time needed to 
earn fair wages. Permanent piece rates can 
be set only when the instructions are such as 
will insure accomplishment of the work in 
the minimum time, and to get sufficient in- 
formation to make out instruction cards suit- 
able for permanent piece rates is often a 
long and tedious operation. On the other 
hand, instruction cards may be made out to 



260 WORK^ WAGES, AND PROFITS 

show the best method of doing work which we 
can devise with our present knowledge and 
appliances. Such cards will seldom repre- 
sent the very best method of performing the 
work, but will usually represent a method far 
superior to that which the ordinary work- 
man would employ. If we can get the men 
to do the work as directed on these cards, 
we can very largely increase the efficiency 
of their work. This is a most obvious way 
of increasing output ; but to base a piece rate 
on such an instruction card would be simply 
inviting trouble, as but few men could see 
that it was just to change a piece rate when 
we changed the method of doing the work. 
If, on the other hand, we allow the men their 
day rate and offer them a bonus for doing 
the work in accordance with our instruction 
cards, they see at once that they have noth- 
ing to lose by conforming to our wishes, and 
all to gain, with the result that in a short 
time they will make an effort to do the work 
in the manner and time set. As stated in 
advance, these instruction cards do not neces- 
sarily represent the best possible method of 
doing the work, but the best method which 
we could devise at the time, and we have 
found that there is practically no objection 



A PRACTICAL EXAMPLE 261 

on the part of the men to a change of time on 
these cards, so long as the new time corre- 
sponds to a new set of instructions which 
will enable them to perform the work in the 
time set. This difference between ordinary 
piece work and our bonus system is funda- 
mental. 

It is hard to over-estimate the value of a 
complete set of instructions showing the best 
method we can devise of performing a piece 
of work; and when we come to consider the 
question of piece work, the payment of a 
bonus, or, in fact, any method of compensa- 
tion, proper instructions embodying our best 
knowledge on the subject are indispensable 
to good results. 

APPLICATION OF INSTKUCTION CAKDS TO A 
MACHINE SHOP 

In order to make proper instruction cards 
for a machine shop doing a variety of work, 
it is necessary to know the laws of the cut- 
ting of metals, as well as the time for han- 
dling work in that particular shop, which 
latter depends upon location of tools, equip- 
ment, etc. The laws of cutting metals are 
very complicated, but they have been de- 
termined by Mr. F. W. Taylor and reduced 



262 woee:^ wages, and profits 

to a slide rule for convenient use by the 
writer. This slide rule has been improved by 
Mr. Carl G. Barth, who adapted it to planers, 
drill presses, and slotters. By means of 
these slide rules we can determine promptly 
the most economical feed and speed for doing 
any operation on a piece of metal of given 
physical qualities. 

As an illustration of exactly how instruc- 
tion cards are made out in a machine shop, 
let us cite the case of a forging that has to 
be rough-machined. The drawing first goes 
to an expert mechanic, who has charge of 
what is known as the routing of the piece 
through the shop. He decides the order in 
which the various operations of turning, 
planing, slotting, drilling, etc., etc., are to 
be done. In a shop doing a variety of work 
too much stress cannot be laid on the rout- 
ing, for, besides the advantage of knowing 
in the office the progress of the work, the 
saving made by performing the various op- 
erations in the best order is very great. This 
subject of routing is large enough for a paper 
by itself,* so it can only be mentioned here 
and its importance emphasized. 

* See the paper by Charles Day, "The Routing Dia- 
gram as a Basis for Laying Out Industrial Plants," The 
Engineeeing Magazine, September, 1910. 



A PRACTICAL EXAMPLE 263 

If the first operation to be performed is 
to be that of turning, the forging is assigned 
to the lathe best fitted for handling this par- 
ticular job. The work to be done on each 
machine is then analyzed by a first-class 
machinist, who can frequently make use of 
the above-mentioned slide rule to advantage, 
and who makes out an instruction card on 
which the operations to be performed on this 
lathe are placed in proper order, with proper 
instructions, the calculated time being given 
for performing each operation. The kind 
of tool to be used, the feed and speed, are 
specified for every machine operation. For 
every other operation, such as putting in and 
taking out of work, setting tools, changing 
feed gears, etc., instructions are given, and 
the time that each should take is placed di- 
rectly opposite the description, in a column 
designed for that purpose. This system of 

At the Zeiss Optical Works in Germany I found their 
best expert mechanic engaged in this routing work. I 
was advised that this practice of having every new piece 
of work analyzed into its details, and the sequence of 
operations specified, had been in use at the Zeiss Works 
seventeen years. Moreover, I was advised that such 
practice was quite common throughout Germany in the 
larger works. It is my opinion that this practice itself, 
if it is as general as I was advised, goes a long way to 
explain the great industrial progress made in Germany 
in the last twenty years, for such a practice has an 
indirect value as great as its direct value, in keeping the 
management in close touch with the needs of the shop. 



OH i»»<uo-6,e,i»oi. 

CLASS OF WORK 

Lathe 


STANDING ORDER 
460 


ORDER NUMBER 
16837 


MACHINE NUMBER 
59 


TOOL 


CLASS OF METAL 
14 


FORGING NUMBER 
22706 B.F. 


MAN'S NAMP ^i -SPEED BOSS M | 


DESCRIPTION OF OPERATION 


SHAPE 

OF 
TOOL 


CUT 


FEED 


SPEED 


TIME 
WORK 
SHOULD 
TAKE 


TIME 
WORK 

DID 
TAKE 


RATE 




Change Machine 20 


Min 




(Fc 


3r Is 


; one 


only) 




1 


Chuck for turning webs 










12 






2 


Turn webs 


PRL 


Scut 


3 E 


4AF 


1:40 






3 


Change to pin centers 










10 






4 


Rough pin to 4 yj" dia 


P3R 




.005 


5AF 


2:10 






5 


Rough face webs use enS^ 


t^^8l 


2cut 


s 


4AF 


1:40 






6 


Fin. ., » M i> 


„ 


Icut 


H 


>j 


5,0 






7 


Fin. turn pin & cut f ille 


its 




E 


2AF 


2:00 






8 


File pin roundi 










1:10 






9 


Polish pin 








2BF- 


40 






10 


Inspect 










15 






11 


Remove crank . 










5 






12 












10:52 


10:5C 




13 


Pin is *1 finish, webs J 


Ire* 


3fii 


dsh. 










14 


(Bonus 


earn 


U) 












15 


















16 






































17 




"i 






























18 
























19 












■--: 










20 
























^t. 


21 








i 


















22 






fc9 ''U 


ours 


«.?»% 




-J o ' '. 










23 




Previous time 


54 1^ 
















OtscRiPTiON Card Na 




1 B.&Co. D«A«iNO No. 


MONTH 


DAY 


YEAR 


SIGNED 


4811 


PCMB 


1 26194 f A 


7 


17 


01 


Buckley- 


WHEN MACHINE CAN NOT BE RUN AS ORDERED, SPEED BOSS MUST AT ONCE 1 

REPORT TO MAN WHO SIGNED THIS SLIP The Engh^^ering Xa!,a'.t«,\ 



FIG. 18. INSTEUCTION" CARD FOR TURNING A CRANK-SHAFT. 
BETHLEHEM STEEL CO., JULY 17, 1901 
264 



A PRACTICAL EXAMPLE 



265 



instruction cards was introduced by me into 
Machine Shop No. 2, of the Bethlehem Steel 
Company, in June, 1899. 



Form 


INSTRUCTION CARD NO . 










MATERIAL. WROUGHT m.QN SIZE 28'6 

TOOL STEEL MTDV ALE CARn DR/ 


■s 33" 

kWINC 


i tin 


OATe 2/20/02 onopR N 








DESCRIPTION OF GPERATIOM 


SHAPE 
OF 
TOOL 


CUT 


FKCO 


SOCIO 


WORK 
SHOULD 

Tina 


1 


SET WORK 










120 


2 


ROUGH ONE SIDE 




1" 


•fe" 


30 


190 


3 


FINISH •• 






1" 


.. 


76 


4 


REMOVE WORK AND CLEAN UP 










30 


5 


RESET 










90 


6 


ROUGH ONE SIDE 




3" 
T 


-t: 


30 


100 


7 


FINISH " 






1" 


.. 


75 


8 


REMOVE WORK AND CLEAN UP 










30 


9 












800 


10 


TOTAL TIME 












11 


13 HRS. 20 MIN, 












12 














13 














14 














WHEN MACHINE CAN NOT BE RUN AS ORDERED, 
FOREMAN MUST AT ONCE REPORT TO 

"-MtTLLANEY Signed 



FIG. 19. INSTRUCTION" CARD, PLANING LOCOMOTIVE 

FRAMES. AMERICAN LOCOMOTIVE CO, 

Note its equivalence to a detail schedule as explained on page 289. 

Figures 18, 19, 20 and 21 are sample in- 
struction cards from various machine shops. 
They need no description. 



266 WOEK^ WAGES^ AND PROPITS 

There was comparatively little difficulty in 
inducing the men to perform the automatic 
operations according to the instructions 
given. For instance, they would run their 
machines at the feed and speed called for, 
but the great difficulty was that it seemed 
impossible to prevent them from losing time 
between operations. One would frequently 
find many of the machines idle, and yet every 
workman could give a more or less plausible 
excuse why his machine was not running, 
and this in spite of the fact that tools were 
ground for him and furnished to him, and 
the work so prepared that all he had to do 
was to put it into the machine and begin 
cutting. In other words, no matter how effi- 
ciently the machines were run through their 
actual working time, the men found good 
excuses for taking more than the prescribed 
time on every job. 

TASK AND BONUS NOT AN ENTIEE SYSTEM 
OF MANAGEMENT 

Although the scientific investigation of 
methods and the making of instruction cards 
are important factors in a system of manage- 
ment, theif are not the whole system; and a 
means of utilizing them is even a more im- 



INSTRUCTION CARD 



LIST NO 



28 L 6 




NOT&- DIMENSIONS ON SKETCH MUST NOT 
BE USED IN MACHININQ 

USE STANDARD DRAWINO. 



Orawins No. 



BACK CYLINDER COVER 



CVL. DIA. 20 TO 24 INCLUSIVE 



SCMSDULC No 



0»SR*TION DRILL CYLINDER AND GUVND STUD 



HOLES, GUIDE BAR BOLT HOLES. 



AND CASING SCREW HOLES. 



Operation No. 



Maohinc BERTRAM RADIAL DRILL NO. 31. 



TWISTED STEEL. 



No. OP PISCKS 



MAN-HOURS Per PiEoe 



PAY EQUIVALENT 



FIRST PIECE 



EACH ADDITIONAL PIECE. 



Tks SKglfittritig JUjatlaa 



FIG. 20. INSTRUCTION CAED FOR DRILLING A CYLINDER 
COVER, C. P. E. (face) 



DETAILED INSTRUCTIONS 


Tool 
Uwd 


Diam. 
of 
DnII 


F«td 

in lnch«« 
Ptr Mm. 


Spindl. 
SfXi.d 


MinutM 
Allowtd 


PREPARE MACHINE FOR Itt. PIECE. 










15.0 


1. SET UP AND CLAMP JIG. 










4.0 


2. SET DRILL. 










0.5 


3. DRILL 17 CYLINDER STUD HOLES 


DOr 


1 1-8 


2 3-4 


225 


15.5 


4. REMOVE JIG AND REVERSE COVER. 










3.0 


5. CHANGE DRILL. 










1.0 


6. DRILL 4 GLAND STUD HOLES. 


DDF 


25-32 


2 3-» 


225 


4.0 


7. REMOVE CLAMP 










1.0 


8. SET ON SIDE OF TABLE AND CLAMP. 










3.0 


9. CHANGE DRILL. 










1.0 


10. DRILL 2 GUIDE BAR HOLES. 


DDF 


1 3-8 


2 3-4 


225 


3.0 


11. TURN ROUND AND CLAMP. 










3.0 


12. DRILL 2 GUIDE BAR HOLES. 


DDF 


1 3-8 


2 3-4 


225 


3.0 


13. CHANGE DRILL. 










1.0 


14. DRILL 3 CASING'SCREW HOLES INCLUDING. 












3 SETTINGS OF COVER. 


DDE 


13-32 


2 


225 


7.0 


15. REMOVE. 










3.C 


TOTAL MINUTES 


53.0 




TOTAL 


HOURS 


PER PIE 


CE 


1.,.°-^ 



The Engineering Maoazin* 



FIG. 21. 



INSTRUCTION CARD FOR DRILLING A CYLINDER 
COVER, C. P. R. (reverse) 

267 



268 WORK^ WAGES, AND PROFITS 

portant part of any system of management 
than they themselves are. In fact, they are 
of but little value, unless we have already 
installed a system by which we can be as- 
sured that our instructions are carried out. 
Moreover, such a system is of great value 
whether we make a scientific study of our 
processes or not, for it enables us to utilize 
fully the knowledge we have. It is much 
more important as a rule to utilize efficiently 
the knowledge we have than to get new 
knowledge. As a matter of fact, much loss 
is often caused by seeking new knowledge 
when we should be trying to utilize better 
what we have. While instructions, a task, 
and a bonus are essential elements in a 
complete system of management, I feel that 
they are not the first portions to be installed ; 
and in a number of cases I have absolutely 
refused to do work with people who wanted 
this portion before the proper foundation 
was laid. 

In more than one case in my experience, 
where my advice on this subject has been 
disregarded, the results have been almost 
fatal to the success of the work. 

In most establishments few people have 
any idea of obeying orders exactly, nor have 



A PRACTICAL EXAMPLE 269 

many of those in authority any idea of giv- 
ing orders so that they can be obeyed exactly. 

We must first devise means by which we 
can give specific orders, and see that they are 
carried out. Having devised such a system, 
we must train people to work according to 
it. One difficulty in the way of operating 
such a system in most factories, as at pres- 
ent managed, is that the amount of clerical 
work becomes so great as to make its suc- 
cessful operation a burden, and most people 
prefer to get along anyway rather than as- 
sume that burden. 

I have given much attention to this fea- 
ture, and my paper, ^^A Graphical Daily Bal- 
ance in Manufacture, ' ' read before the Amer- 
ican Society of Mechanical Engineers in June, 
1903, describes the general method employed. 
This is a method of scheduling and recording 
work which has been found most satisfactory, 
as offering the means by which we could get 
our work done at the time and in the manner 
we wished. These schedules form the basis 
on which I found much of my work, for, by 
the proper operation of such balances as 
those described, we can in a comparatively 
short time begin to get a direct benefit. 

In installing such a set of schedules the 



270 work:, wages, and profits 

work must be done in the manner best 
adapted to the application of the task and 
bonus system later. 

The essentials of a correct system are a 
store-keeping system and a time-keeping 
system suited to this method of controlling 
work, a balance of work, a man record, and 
a system of expense and cost keeping that 
enables the superintendent to know each day 
what was done the day previous, who did it, 
and what the expense of it was. 

The following will give some idea of the 
important elements of such a system: 

MAN KECOKD 

In order to operate such a system we must 
not only have an exact record of what each 
workman does each day, in order to find out 
whether he has earned his bonus or not, but 
must have beforehand an exact knowledge 
of the work to be done and how it is to be 
done. This amounts to keeping two sets of 
balances ; one, of what each workman should 
do and did do; the other, of the amount of 
work to be done and actually done. The 
former, or man's record, is concerned with 
the training of men to earn the bonus, and 
consists in an exact comparison of what 



A PKACTICAL EXAMPLE 271 

should be done as determined by onr investi- 
gations, and what was done, as shown by 
the daily reports. It is also of great value in 
the preliminary period of day work before 
we set any tasks, as it enables ns to know 
each day what every workman is doing for 
the money he receives. "Where the rate of 
wages is set and advanced in accordance 
with his record, it has been found to be a 
very satisfactory method of producing ef- 
ficiency. While it does not take the place of 
scientific task-setting, it is far superior to 
rate-setting without proper study. 

DAILY BALANCE OF WORK 

This latter is a balance of work on each 
order, and should show at a glance each day 
just what has been done and what remains 
to be done, in order to enable us to lay out 
the work for the next day in the most eco- 
nomical manner. The importance of such a 
balance has been long recognized, but the 
difficulty of getting it is such that it has sel- 
dom been attempted. Many concerns get a 
weekly or monthly balance; but in both of 
these cases the information is usually ob- 
tained too late to prevent delays in work. 
Again, the value of a balance is dependent 



273 WORK^ WAGES^ AND PROFITS 

largely upon its availability ; in other words, 
upon the ease with which the desired infor- 
mation can be obtained from it. "With this 
idea in mind I devised a combined schedule 
for work and a balance sheet that is largely 
graphical in its nature. On it dates are 
represented by positions, and when work is 
not done on consecutive days there are no 
entries in consecutive positions. This prac- 
tice enables the superintendent to see at a 
glance what work is going along properly. 
Such schedules can be made out for all 
classes of work, and a description of one or 
two will amply illustrate the principle. 

A rOUNDKY SCHEDULE AND BALANCE 

Figure 22 represents such a balance sheet 
and schedule for a foundry. At the heads of 
the various vertical columns are the names 
of the pieces to be cast, under each is its pat- 
tern number, then, in order, when the pattern 
is due at the foundry, when it is received, 
the number wanted per day, and the total 
number wanted. Below, each column is di- 
vided into two columns headed *^ Daily" and 
^' Total." These are crossed by horizontal 
lines representing consecutive working days, 





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273 



274 WORK^ WAGES^ AND PROFITS 

on each of which are entered in the proper 
column the number of pieces made that day 
and the total number made to that date. 
Each column is crossed by two heavy red 
lines, the upper one opposite the date at 
which the work should be begun, and the 
lower one opposite the date at which the 
work should be completed. These lines have 
been very appropriately named ^'danger 
lines." The positions of the entries with 
reference to these danger lines, and the 
amounts of those entries, show to what ex- 
tent the schedule is being lived up to. If 
the schedule is being well followed the entries 
are always in the neighborhood of the red 
lines, or above them. 

Figure 22 represents a portion of an actual 
order showing how it was filled in the foun- 
dry of the Schenectady Locomotive Works. 
If there is no graphical check on the opera- 
tions of the foundry, the work that is wanted 
during a certain week may be spread over 
three or four ; such is often the case, as our 
records show. 

It is an extremely difficult matter for a 
foreman to get the work done exactly in the 
order it is wanted. For instance, if we are 
building two locomotives per day, each re- 



A PRACTICAL EXAMPLE 275 

quiring four driving boxes, it seems an ex- 
tremely difficult thing for him to get every- 
day, without fail, at least eight driving boxes. 
Why this is so is a psychological question, 
and I can't explain it, but that it is a fact is 
too well known to admit of discussion. There 
is a constant tendency when he is rushed with 
other work to drop to six or seven, with a 
corresponding decrease in output of locomo- 
tives. This tendency to give about what is 
wanted rather than exactly what is wanted 
is the most common obstacle to getting the 
full output of a plant. , 

A DAILY BALANCE AS A PEEMANENT KECOED 

This balance sheet shows not only how 
much work was done each day, but is a per- 
manent record of exactly how the order was 
filled, which can be compared with the record 
of the previous orders and is of great value 
in planning subsequent orders. This is best 
illustrated by Figure 22, which shows exactly 
where failure to comply with the schedule oc- 
curred. The letter ^^P" entered in some of 
the columns shows graphically the reason for 
the castings being behind. The pattern was 
not received until the date indicated. Simi- 
lar sheets would probably show that it was 



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377 



278 WOEK^ WAGES, AND PROFITS 

the draftsman and not the pattern maker 
who was to blame. 

A MACHINE-SHOP BALANCE AND SCHEDULE 

Figure 23 is a similar balance sheet for 
work done in a machine shop on a series of 
locomotive frames and rails. The order in 
which the various operations are to be per- 
formed has been determined, and the consec- 
utive columns are devoted to the operations 
in their proper order. It will be noted on 
this sheet, which is an actual record of work, 
that the consecutive operations were per- 
formed promptly and that there was no seri- 
ous delay. 

Figure 24 represents a record of the same 
work as it would appear if the works were 
short of frame-drilling capacity, and the 
drilling of frames were not done promptly. 
If it is impossible to make up the delay thus 
caused the output is limited by it. Such 
sheets show at a glance where the delays oc- 
cur, and indicate what must have our atten- 
tion in order to keep up the proper output. 
If the delay is always on the same operation 
we know that we must either get more output 
from the machine doing that work, or get 
more machines. 



A PRACTICAL EXAMPLE 279 

A GEAPHICAL BALANCE AS A HISTOKY 

A complete set of such sheets for all the 
work in a plant gives a complete schedule 
and a daily record of what is being done, and 
is of the greatest possible advantage if an 
attempt is to be made to improve the condi- 
tions or increase the output of the plant. In 
fact, if the improvement in the operation of 
a plant is to be made in a scientific manner, 
exact knowledge of what is taking place each 
day is absolutely necessary. Without it, 
money is often spent wastefully, and but a 
small proportion of the desired results ob- 
tained. In large plants run without such a 
system of balances it is frequently impossible 
to tell just what is holding back the output. 
In a case of this kind the value of such a bal- 
ance is out of all proportion to the cost of 
obtaining it. By using the graphical form its 
value is very much increased, for the general 
appearance of the sheet is sufficient to tell 
how closely the schedule is being lived up to. 
Moreover, such a balance is a history of the 
way the work went through the shop and is 
readily comparable with similar work done 
previously or subsequently, thus enabling us 
to form a definite idea as to whether the 
plant is being run more or less efficiently. 



^80 WORK^ WAGES^ AND PROFITS 

This balance of work, or schedule, sheet then 
gives lis a daily analysis of how the work is 
progressing, and in its graphical form is so 
easily read that superintendents find it of 
great value. The man's record shows the 
efficiency of each man, and the two taken to- 
gether give us the knowledge, in the clearest 
way, of what should be done to increase our 
output. 

VALUE OF MAN EECORD AND BALANCE NOT DE- 
PENDENT UPON METHOD OF COMPENSATION 

It is not the intention to discuss the mak- 
ing of schedules for doing work, or the sub- 
ject of compensation for work done, for the 
keeping of a daily balance of work done and 
a record of the men doing it are invaluable, 
no matter what the method of compensation. 
In fact, I have found the man's record when 
work was done by the day to be of the high- 
est value, for when men realize that not only 
their chance for increase of wages, but that 
of holding their positions, depends upon the 
amount and quality of their work, they be- 
come very much more efficient. Add to this 
the fact that efficient men, paid in proportion 
to their efficiency, are invariably better satis- 
fied than less efficient, cheaper men, and we 



A PRACTICAL EXAMPLE 381 

have an added reason for keeping the man's 
record. Again, a workman easily forgets 
how many days he has been absent, and how 
much poor work he has done, and an occa- 
sional glance at his record often does him a 
great deal of good. I first kept such a rec- 
ord in the foundry of the Midvale Steel Com- 
pany over twenty years ago, and found it so 
valuable that I have always done it since 
when possible. 

The question is frequently asked as to the 
cost of keeping these records and balances. 
In reply I have to say that if such cost were 
ten times what it is, it would cut no figure. 

In day work we buy a man's time, and he 
frequently gives but little else. Our store- 
keeper checks exactly the materials we buy, 
but nobody knows exactly what the day work- 
man has done in the hours paid for. Although 
we know labor to be the most difficult com- 
modity we have to buy, we give it the least 
systematic study, and any effort to get an 
exact record of what we get for our money is 
the first step toward purchasing it in an in- 
telligent manner. "With regard to the balance 
of work, I can only say that it is hard to esti- 
mate the cost of lack of harmony in a plant, 
and the increase of efficiency produced by get- 



282 



work:^ wages^ and profits 



IN 








. 


orDcr no. 




MAM'S NS.4L DM 


MAN'* NAMC 


ORAWINCNp. 


TIME 

ALLOWED 


TIME 
TAKEN 


STMBOL 


MAOMtNENo. 


BONUS 


RATE 


BONUS 


UBOR 1 


PAV FOR 


WAGES 


OESCniPnONOFWORK 


OPEA 

WO, 


m. or 


UN-a 
Tm 


^ 










































ENTERCO IN 


1 HAVE •SSPCCTCO THE WORK REPRESENTED BrlHC ABOVS 1 
ENTRIES 1 NO BELIEVE THEM BOTH TO BE CORRECT. 1 


SHEET 


eoer 

SHEET 


RECORD 
•HEET 








at 


LMC BOSS 


OMa ntSn9lKteH*9Ma9<u*— 



FIG. 25. TIME CABD FOB A MACHINE SHOP 

ting materials in their proper order rather 
than according to the judgment of the vari- 
ous foremen is greater than is usually 
realized. 

The value of a balance of some sort is too 
well understood to need discussion, and the 
only reason that it has not been adopted is 
often the fancied cost of getting it. As a 
matter of fact all I have suggested is so 
closely allied to the time and cost keeping 



A PRACTICAL EXAMPLE 



283 



that when all are done together by the best 
modern method the cost is not great, al- 
though it does cost money to change from 
one system to another, and the systems in 
general nse are not at all suitable for this 
purpose. The method referred to is the 
*^time and production card'' system, under 
which a man usually receives for each job a 
card which is stamped with the time of issu- 
ing and of returning. 



OPenATive-s namc 



TIME 
ALLOWED 



TIMC 
TAKEM 



OPeRATIVE'S 



4 



MAOMINC 
NO. 



CLOCK REAOINQ 



IF WORKING ON BONUS 
CROSS OUT THIS 03* 



IA6QR 



OirFIRKNCE 



OETAIkOFWORK ON BACK 



ENTERED IN 



nceonp SHcaT 



I HAVE INSPECTCO THE WORK REPRESENTED BT 
THE ABOVE ENTRIES AND BELIEVE THEM BOTH TQ 
ee CORRECT. SIGNED BY 



OEPARTMEMT D4 oa« 



FIG. 26. 



Xlu Snglnetring ttagoiiM 

TIME CARD USED IN A BLEACHEEY 



J2D1 





la la tia: It la K 1^ ii I^P K li liiaio: fa I ^ is: 1^ [a |s:k k ^1 



|Q.[|a.|Q. |o.[[a:[|£ |jo.[|a. ||o.[|Q.|Q.[j£||a. pa: ||Q:|a-j[a. |[a. [|q. |q. |[q. [[q. |ja. [[q. ||a.|] 



lyuii 






JiiMMiB 



aiiiiiiew 



ii iii iii a i 



11 



ILi 



=^i= 



o 



iiii 



iiiiiiiii 



MuuuuuuyuuuyuMuuuuuuuiiiJUij 



ill 



ii 



iii 



i 



Q 



284 



A PRACTICAL EXAMPLE 285 

Figures 25 and 26 on pages 282 and 283 
are examples of time cards. 

These sample cards are stamped with the 
time work begins and are taken from a card 
rack, Figure 27, as the men come in at the 
beginning of the work period. If it is desired 
to know the time on different operations, the 
cards are returned to the time keeper at the 
end of such operations and stamped with the 
time. A fresh card stamped at the same time 
is given to the workman. At the end of the 
work period the workmen place their cards 
in the rack as they go out. 

TIME AND man's BECOBD 

In order to get a record of the man's time 
and work for the day, all the cards bearing 
his number must be gotten together. If these 
do not give a total of the full number of work- 
ing hours, the first card of the day must show 
that he was late, or there must be a pass stat- 
ing the time he went out. These passes 
should be of the same size as the cards, and 
be put in with the time cards and sorted out 
by the man's number, so that when the clerk 
begins to enter the time and record he will 
have all the necessary information for this 
purpose at hand. 



286 WORK^ WAGES^ AND PROFITS 

COST 

To get the cost on an order the cards are 
then sorted by '^ order number'' and when 
the clerk begins to enter up the time or wages 
against any order, he should have before him 
all the cards representing work on that order. 
He is thus enabled to make the final entry 
directly from the cards, thus doing the work 
with a minimum of clerical labor. 

The total cost of the clerks employed in 
store-keeping, time-keeping, cost-keeping and 
the keeping of all records needed for the 
schedule and production sheets is in some 
cases as low as 5 per cent of the total pay- 
roll, and in the ordinary factory should not 
be over 8 per cent. 

PROGRESS OF PRODUCTION 

To get a record of the work on any order, 
the cards which have been sorted out by 
order number are further sorted by name 
of part and operation. We thus get together 
the cards showing on an order the number 
of pieces on which a certain operation has 
been finished that day. These are added up 
and entered directly on the schedule sheet. 
By this method we can keep an intelligible 



A PRACTICAL EXAMPLE 287 

record of all the work done with a minimum 
of clerical labor. 

DIFFICULTY OF GETTING A DAILY BALANCE 

It is not necessary for the purpose I have 
in mind to dwell further on the details, my 
object being only to show that the difficulty 
of getting this daily record of our men and 
a balance of the work done is not so great as 
to be prohibitory. In other words, it is an 
entirely feasible thing to know exactly all 
that has been done in a large plant one day 
before noon of the next, and to get a complete 
balance of work in order to lay out that after- 
noon in a logical manner the work for the 
next day. 

VALUE OF A SCHEDULE AND BALANCE 

The value of such a balance consists in the 
fact that it makes clear details that no ob- 
server, however keen he may be, can see by 
inspection. It shows us what work is behind 
and how much, and enables us to trace to its 
source the cause of any delay. The super- 
intendent sees at a glance what he never 
could find out by observation or by asking 
questions. It shows him how efficiently a 
plant is being run and where the defects in 



388 WORK^ WAGES^ AND PROFITS 

operation are. In connection with the man's 
record, it is the most complete analysis we 
can make of the working of a plant, and the 
one that will help us most quickly to bring 
into their proper channels things that have 
gone haphazard. Such an analysis is far 
more important than an improved tool steel 
or a new set of piece rates, for it enables 
those in authority to see each day how their 
orders are being carried out, 

ACCOUNTING AND OPEEATION 

It is my opinion that we can do nothing in 
a manufacturing plant that will go so far 
toward increasing the output, or the economy 
of operation, as obtaining this exact knowl- 
edge of what is being done. The cost of get- 
ting it is not great and the method of opera- 
tion need not be disturbed in the least until 
accumulation of knowledge points out the 
best course to pursue. 

By the adoption of the methods outlined 
the accounting department ceases to be sim- 
ply a critic of the manufacturing, and be- 
comes an active assistant to every foreman 
and to the superintendent. In other words, 
the accounts cease to be simply records of 
production, and become potent factors in 



A PRACTICAL EXAMPLE 289 

helping the producing departments to 
greater efficiency. 

SCHEDULE SYSTEM 

The instruction card is really a detail 
schedule which represents our best knowledge 
of the method and speed of doing work. 
Hence, this whole system of manufacture, 
viewed from this standpoint, is a schedule 
system, and may be likened to the system of 
operating trains on a railroad. The train 
despatcher is the center of such a system 
on a railroad, and the head of the ^^ planning 
office'^ where all our schedules originate and 
records are kept has a similarly important 
job. It is his business to keep the routine 
operations of the factory going on the lines 
that have been laid down, and if he does his 
work properly, an advance once made should 
never be lost. He is strictly a routine man, 
and carries out the instructions of the super- 
intendent and the other experts, who study 
all problems and determine methods of solv- 
ing them. 

KOUTINE AND EXPEET WORK 

All work may be divided into these two 
general classes, and it is an interesting fact 



290 WORK^ WAGES^ AND PROFITS 

that the vast majority of men may be di- 
vided into similar classes. We sometimes 
find a man who can do equally well either 
kind of work, but this is rare. As a rule a 
man prefers either to follow instructions day 
after day, or finds it very irksome to follow 
instructions at all. The first man usually be- 
comes a good routine man; the second may 
become an expert if he has honesty, ability to 
think, and industry. Such men become art- 
ists, designers, engineers, investigators, and 
inventors. They are the men, such as Watt, 
Fulton, Stephenson, Whitney, Edison, and a 
host of others, who are primarily respon- 
sible for the civilization of today. It is of 
the greatest importance that such men 
should be properly trained and utilized. 

If such a man has honesty and industry, 
but no ability, he is apt to spend his time 
making useless inventions. If he has honesty 
and ability, but no industry, he is very apt 
to spend his time telling other people what 
they should do. If he has ability and indus- 
try, but no honesty, he has in him the making 
of a bank wrecker, or a burglar, as the op- 
portunity offers. 

Our manufacturers have given too little 
attention in the past to this kind of man, and, 



A PRACTICAL EXAMPLE 291 

instead of guiding him, have too often re- 
pressed him, to their own detriment as well 
as his. A proper system of management 
recognizes that many men belong to this gen- 
eral class, and makes provision for utilizing 
them. 

GENERAL PRINCIPLES AND DETAILS 

While this chapter has necessarily been de- 
voted largely to general principles, I have 
shown enough details to give a general idea 
of the system advocated, which is one in 
which the manager takes the responsibility 
for managing instead of ^'putting it up^' to 
someone else, 

"While the idea is simple, it has taken a 
vast amount of work to make the method of 
carrying it out sufficiently simple to be prac- 
ticable on a large scale. The attempt to 
carry this out in a large variety of plants 
during the past fifteen years has resulted in 
developing many methods that are common 
to, or similar in, all kinds of manufacture. 
This varied experience has greatly helped 
us to simplify our methods, and those that 
undertake to carry out this general idea with- 
out developing shorter methods than the 
writer has usually found in vogue will soon 



292 WORK^ WAGES, AND PROFITS 

be floundering in a hopeless maze of detail, as 
many have done in the past. These are the 
men who are wasting so much energy today 
telling US that this work can't be done. 

The failure of one man is no indication 
that all men will fail, and the energy wasted 
in attempting to prove such a proposition 
almost tempts me to offer the following ad- 
vice given by a celebrated professor to a 
student who was always trying to tell why 
things could not be done: *^You had better 
be careful; some damn fool will come along 
some day and do it." 



INDEX 



INDEX 



Accounting and operation, 
288; department potent 
factor in efficient produc- 
tion, 288 

Accuracy of thought ac- 
quired, 223 

Advancement — Chance for, 
89 

American Locomotive Com- 
pany, 68, 70; Society of 
Mechanical Engineers, 87, 
111, 149 

Analysis of details essential to 
efficiency, 23; of each job, 
with instructions, 42; of 
operation into elements, 
41, 95, 257; of machine 
work, 263; of work im- 
portant and feasible, 287, 
288; of work's progress, 
280 

Antagonism between em- 
ployer and employee, 20; 
means conflict, 54; can be 
overcome, 55 

Appliances, definite, for task, 
149; for work, 256; if 
adequate, increase out- 
put, 23 

Apprentice system, 98, 238; 
founded on sound prin- 
ciples, 239 

Arbitration, Board of, tem- 
porary expedient based on 
superficial knowledge, 21; 
useful in averting a crisis, 
28 



Association, Employers', 20; 
organized to oppose 
Union demands, 27 

Attraction of better work- 
men, 30 

Average workman does only 
two-thirds task at first, 43 

Balance, graphical, as his- 
tory, 279 

Balance sheet for machine- 
shop work, 278 

Balancing work daily, 271 

Barth, Carl G., improved 
shde rule, 262, 263 

Benefits derived from de- 
tailed investigation, 30; 
of task-setting explained 
to men, 134; to employer 
and employees, 166 

Bethlehem Steel Company, 
149; fixed bonus, 114 
coal unloaders, 71, 72 
efficiency methods, 104 
individual records stan- 
dardized, 70; instruction 
cards, 265; machine 
shop, bonus results, 108; 
output increased, 112; 
system at Machine Shop 
No. 2, 265; task and bonus 
introduced, 70, 253; works 
closed by drive system, 
113 

Bleachery, folding room, 192- 
194; methods, 138-141; in 
Rhode Island, 207, 208; 
reorganized, 212 



295 



296 



INDEX 



Bleaching processes, 139 

BluflSng methods not effec- 
tive, 162 

Bonus — See Task and Bonus 

Bonus System of Rewarding 
Labor, 148 

Bosses as servants and teach- 
ers, 157 

Breakdowns infrequent under 
bonus system, 109 

Buying labor an important 
operation, 44, without re- 
gard to quaUty, 66 

Capital tied up by desultory 
work, 133 

Capitalist less Hberal than 
workman, 56 

Captains of industry, 227 

Carnegie, Andrew, recognized 
value of increased product, 
216, 242 

Character of work determines 
additional pay for eflfi- 
ciency, 29 

Charts, explained, 187; Ust of, 
16; sources of, 3 

Children, standard method 
of teaching is task system, 
121, 122 

Citizenship improved, 203 

Class wage badly gauged 
lowers tone of shop, 60 

Classifying expert knowledge, 
169; work simplifies it, 
132 

Clean machines for best re- 
sults, 109 

Clerical work least efficient 
in factory, 217 

Combinations, industrial, 227 

Community benefited by en- 
gineers' work, 19; differ- 
ence between savage and 
civihzed is in laws, 52; in- 
fluenced by habits of 
shop, 221; moral tone 



lowered by resort to force, 
67 

Compensation (See Wages) 

Competition, diflficulty of 
meeting, 22; reduced, 227 

Complaints analyzed, 210 

Conditions governing new 
work studied in advance, 
86; in manufacturing in- 
dustries, development of, 
21; necessary for best re- 
sults, 40 

Confidence inspired by task 
demonstration, 108; in 
superiors a result of train- 
ing, 155; of men won by 
adequate pay, 110 

Congestion disappears under 
planning, 132 

Consideration for workmen 
by management, 197 

Conspiracies for restraint of 
trade, 234 

Control of factory by one 
man impossible, 22 

Co-operation among employ- 
ers to uphold prices, 229, 
237; assured by task and 
bonus, 203; between em- 
ployers and employees, 
19, 20, 220; foremen and 
workmen, 143; gained by 
force is unstable. 111; in 
hving up to standards, 
166; Uke that of foot-ball 
team, 249; of good men by 
adequate pay, 110, 240; 
of workmen in fixing rate, 
88; by management in- 
creases output, 209; of 
men under bonus system, 
110; of strong manage- 
ment with workmen, 219; 
to study economies, 237 

Cost keeping system, 270; in 
a cotton mill, 171, 175 



INDEX 



297 



Cost of changing systems, 
249; daily balance, 279; 
discord, 281 ; initial inves- 
tigation, 29; living in- 
creased by higher selling 
price, 231 ; low wages more 
than cost of high wages, 
48; manufacturing re- 
duced, 169; order ob- 
tained from cards, 286; 
product decreased, 30; 
record-keeping negligible, 
281; selling reduced, 227 

Cost reduction, 216; by Tay- 
lor system, 149; increases 
profits, 231 ; through study 
of men and processes, 233 

Costs, elements affecting, 241 ; 
increased by horizontal 
wage increase, 234 

Cotton-finishing industry im- 
proved by uniform bleach- 
ing, 141 

Cotton mill, efficiency work, 
175; example of results of 
training in, 91, 92 

Crane service improved by 
bonus system, 109 

Crimes to prevent exposure 
of irregularities, 125 

Daily Balance, A Graphical, 
87, 269; difficulty of get- 
ting, 287; in graphical 
form, 279; two sets, 271 

Day rate, how regulated, 65; 
paid when the task is not 
completed, 114; perma- 
nent, bonus extra, 255; 
plus percentage, 158; 
raised in accordance with 
records, 66 

Day work, 61, 65-73, 165; 
competently planned in- 
creases efficiency, 67; de- 
fined, 65; for unskilled, 
114; two classes, ordinary 



and planned, 65; with in- 
dividual efficiency records, 
67; uniform wage de- 
creases efficiency of, 66 

Day's task, 28 

Decrease in cost through sci- 
entific investigation, 30; 
in efficiency, fault of man- 
agement, 60, 61 

Delays Umit output, 278 

Demonstration of task, 108 

Departments of factories, 22 

Detail analysis, 263; essen- 
tial to efficiency, 23; of 
elements of piece work, 
82, 87; study belongs to 
engineer, 237 

Devices for labor-saving less 
useful without co-opera- 
tion, 20 

Differential piece rate, 107 

Direct results of bonus sys- 
tem, 108 

Directing workmen intelli- 
gently increases output, 23 

Distrust of new methods, 23, 
24 

Drive system, 113; creates 
progressive opposition, 
110; ehminated by bonus 
system, 109 

Dye works remodeled, 212 

Earle, E. P., suggested bonus 
to gang boss, 107 

Earnings in good times should 
provide best apparatus 
made, 35 

Economical operation unu- 
sual with man left to him- 
self, 41; utiHzation of 
labor is manager's great- 
est problem, 19 

Economies, co-operation for 
studying, 237; effected, 
213; shown to be feasible, 
24; through exact knowl- 



298 



INDEX 



edge, 288; of industrial 
combinations, 227, 229 _ 

Educational system with 
prizes, 256; value of task- 
setting principles, 150 

Efficiency an economic fac- 
tor, 235; becomes general 
through habits of work, 
221; dependent on har- 
mony of operations, 94, 
95; impaired by increas- 
ing difficulty of task, 92; 
impossible without co- 
operation, 20; individual 
records necessary to, 60; 
in workroom a habit, 186; 
increase raises standard, 
162; increased by co-oper- 
ation, 19, 20; by giving 
workman share in bene- 
fit, 23; by individual 
records, 60, 69, 280; by 
planning order of work, 
126; by proper appliances, 
23; by direction of work- 
men, 23; by scheduling, 
127; by system, 84; lost by 
changing system without 
training men, 7; of labor 
increasing, 167; of opera- 
tions determined by scien- 
tffic study, 36; permanent- 
ly maintained, 23; pro- 
gressive, 221 ; should reach 
maximum before plant is 
enlarged, 245; work in 
cotton mill, 175 

Efficient doing becomes fixed 
habit, 154; man ade- 
quately paid will not join 
inefficient men, 104; men 
object to inefficient sys- 
tem, 71; will not join 
imion unless benefited, 
73; operation of small 
plant, 245; shovehng, 37- 



39; system impossible 
without systematic man- 
ager, 86; utilization of 
labor, 24, 33; work de- 
manded by high wages, 
34; w^ork, four conditions 
necessary, 40; workmen 
distinguished from others 
by records, 58 

Elements of successful sys- 
tem, 116 

Elementary operations fewer 
than complex ones, 41; 
study of, 41 

Employer and employee, co- 
operation between, 20; 
equity between, 27, 33; 
mutually beneficial ar- 
rangements, 33; relations 
between, 20; benefited by 
co-operation, 166 

Employers responsible for 
labor unions, 73, 78, 81 

Encouragement of industry 
by adequate pay, 186 

Engineer scientifically trained 
an economic factor, 235 

Engineers, mechanical, should 
study men and machines, 
235 

Equipment, poor, prevents 
efficient work, 34; kept up 
to date out of earnings, 
35 

Errors in machining reduced, 
108 

Essentials of piece-work sys- 
tem, 82 

Estimate by busy foreman 
inaccurate, 80 

Evasion of laws by trusts, 52; 
patent laws, 53 

Excavating, example of in- 
creased efficiency, 70 

Exertion stimulated by vary- 
ing wages, 60 



INDEX 



299 



Expense made excessive by 
management, 22; of de- 
lays and interferences 
eliminated, 127; of inves- 
tigation, 29; of record- 
keeping, 70, 71; of train- 
ing workmen — who should 
bear it? 98; overhead, 216, 
242; reduced by analysis 
of details, 23 

Expert, essential qualities of, 
84; helped by standardiz- 
ing knowledge, 169; knowl- 
edge defined, 161; makes 
poor foreman, 84; me- 
chanic personally direct- 
ing employees, 22; super- 

^ vision of machine work, 
105; work, 161 

Experts, corps recruited from 
workmen, 83; for every- 
thing but labor-buying, 44 

Extra pay for man doing 
task in set time and way, 
82, 91; men supplying 
materials for bonus win- 
ner, 82, 91 

Factory divided into depart- 
ments, 22; one-man con- 
trol impossible, 22; un- 
trained foreman in, 22; 
system, 98, 238 

Failure to get permanent ef- 
ficiency, 110 

Fallacy that good work must 
be done slowly, 153 

Force not a basis for good 
management. 111; sub- 
stitute for knowledge, 28; 
prevented by assurance of 
equitable pay, 81; used by 
unions, 57 

Forces, scientific investiga- 
tion discovers, 19 

Foreman becomes friend in- 
stead of driver, 115; be- 



comes instructor under 
bonus system, 109, 114; 
executive, not expert, 83; 
has bonus in proportion 
to men earning it, 256; 
given manager's problem 
to solve, 97; too busy to 
make detail investiga- 
tions, 83 

Foremen and workmen mu- 
tually interested, 143 

Forms and blanks are means 
to an end, 8 

Foundry schedule and bal- 
ance, 272 

Frictional lag changed by 
bonus, 170 

Fundamental principles of 
success in machine shop, 
108-110 

Gain in efficiency of work- 
men, 23 

Gang boss, 157; gets bonus 
for each man earning 
bonus, 107; helps poor 
workmen, 156 

Gangs, large ones decrease 
efficiency, 72 

Gauging amount of work 
done by each man diffi- 
cult, 58 

Good faith, workman's con- 
fidence in employer's, 94; 
in management reduces 
number of mistakes, 47 

Government, self, 20, 73 

Graft eliminated under scien- 
tific methods, 125 

Graphical Balance as His- 
tory, 279; Daily Bal- 
ance in Manufacture, 87, 
269 

Guess-work in estimating 
rates, 80 

Habit of shop influences com- 
munity, 221 ; working 



300 



INDEX 



promptly and well a val- 
uable asset, 154 

Habits of industry (See Hab- 
its of Work) ; of truth and 
honesty, 171; of work, 
153; acquired, 182; con- 
crete examples of, 175; 
improved, 203; more im- 
portant than the work 
itself, 221; produce gen- 
eral efficiency, 221; valu- 
able, 147 

Harmonizing elements upon 
which efficiency depends, 
94 

Health improved by bonus 
system, 152; by mastery 
of task, 224 

High-speed steel reduces 
time, 138 

High wages demand efficient 
work, 34; for efficient man 
better than low wages for 
inefficient man, 97 

Horizontal wage system, 58; 
results in labor unions, 
103; in employers' asso- 
ciations, 103 

Immigrants trained to habits 
of work, 221 

Improvements in non-met- 
al working industries, 
141; indicated by scienti- 
fic investigation, 150, 
151; shown to be feasible, 
24 

Improving plant, 35; quality 
of product, 30; system of 
management, 35 

Incentive greater with per- 
centage than fixed bonus, 
114; to good work auto- 
matic, 109 

Inconsistencies in day-work 
plan, 65-78; piece-work 
plan, 79; revealed by sci- 



entific investigation of 
processes, 156 

Increase of efficiency essen- 
tial to increase of wages, 
40; continued success, 60; 
first problem in, 94; makes 
high wages possible, 47; 
manager's problem, 60; 
must be systematic, 84 

Increased output result of 
scientific investigation, 30 

Increased wages demand 
maintenance of efficiency, 
33, 40; for increased effi- 
ciency, 70, 71; not chief 
feature of Mr. Gantt's 
methods, 3, 4; under task 
system, 207; without in- 
dividual record make 
trouble, 65, 66 

Individual records, expense 
exceeded by results, 70, 
71; in foundry, 69; neces- 
sary to efficiency, 60; 
standardized, 70; usually 
not kept, 58; with corre- 
sponding pay bring confi- 
dence and loyalty, 78 

Individual study requires 
marked ability, 232; work 
better when planned, 128 

Inducement to perform task, 
122 

Industrial combinations, 227; 
conditions interpreted, 6; 
development, history of, 
21; success due to patent 
laws, 53; Workers of the 
World, 191, 199; attack 
cotton mills, 192; incite 
Lawrence strike, 199 

Industry, Habits of (See 
Habits of Work); make 
knowledge and skill valu- 
able, 147 

Inefficient plant design or 



INDEX 



301 



equipment prevents eflB- 
cient work, 34; workman 
demoralized by too high 
wages, 60; made eJEcient, 
104 

Inspection, careful, improves 
work, 167 ; made easy, 191 ; 
of woven materials, 191, 

. 192 

Inspectors earn bonus, 191 

Instruction card for crank 
shaft, 264; drilling cy Un- 
der, 287; forging to be 
rough-machined, 262; 
lathes, 264; permanent 
piece rates, 259; planing 
locomotive frames, 265 ; 
workmen, 255 

Instruction cards in machine 
shop, 261; must be ac- 
curate, 255; turn laborers 
into eflSicient machine 
hands, 108 

Instructions and training, 
basis of system, 117; as to 
elementary operations re- 
paid by results, 42; em- 
bodying best knowledge 
obtainable, 261 

Instructor and bonus estab- 
lish permanent standard, 
161; constantly on hand, 
157; for practical apphca- 
tion of investigation, 151; 
not necessarily investiga- 
tor, 158; shares responsi- 
bility for doing task, 136; 
shows men how to do work 
in time set, 255; teaches 
one man at a time, 157, 
158; teaches workmen 
best methods, 40; with 
stop-watch asked for, 155 

Instructor's job for workman 
who often exceeds task, 88 

InteUigent action based on 



facts, 221; direction of 
men increases output, 23 

Interest in work makes it less 
tiring, 152 

Introduction, 3; of task sys- 
tem, 168 

Investigation expensive but 
profitable, 29; in detail of 
each job, 82, 116; of lost 
bonus invariable, 137, 
163, 170; materials and 
forces, 19; use of results 
of, 29; work by best 
available expert 160. 
(See also Scientific Inves- 
tigation). 

Investigator if necessary be- 
comes instructor, 135; 
should be most expert 
workman available, 88 

Investigator's duty to devel- 
op methods and set tasks, 
159 

Investigators become super- 
intendents, 162 

Knowledge cannot be re- 
placed by force, 28; of 
best methods, appliances 
and materials, 40; of ma- 
terials and forces, 19 

Labor-buying important, 44; 
intelligent, 281; key to, 
44-46; regardless of qual- 
ity, 66 

Labor of bleaching reduced, 
140; -saving devices, testi- 
mony of, 19; use of, im- 
paired, 20; troubles elim- 
inated by bonus system, 
113 

Labor unions, 20, 27; advance 
poor workman and good 
equally, 57; bring collec- 
tive bargaining, demands, 
strikes, 78; cannot always 
keep up day rate, 65; 



302 



INDEX 



cannot permanently solve 
problem of relation be- 
tween employers and em- 
ployees, 20; have upheld 
or increased price of labor, 
229; idea of, 57, 58; must 
be replaced by something 
better, 59; not joined by 
man not benefited, 73; 
oppose improvements, 
238; prevented by assur- 
ance of equitable pay, 81; 
reasons for joining, 57; 
resemble trusts, 54; result 
of management, 103; 
strongest argument in fa- 
vor, 59; injustice, 26 

Laboratory for scientific 
study of materials and 
forces, 24 

Lag changed to acceleration, 
170 

Lathes, instruction cards for, 
263 

Lawrence strike, 199 

Laws evaded by trusts, 52; 
make difference between 
savage and civilized 
places, 52; of manage- 
ment determined by sci- 
entific investigation, 27; 
of metal-cutting compli- 
cated, 261 ; regarding pat- 
ents have made indus- 
trial success, 53 

Liberal pay for efficient work, 
72, 73 

Liberahty of workmen to 
each other, 56 

List of work in order wanted 
aids foreman, 129 

Location of tools, 261 

Locomotives, task idea illus- 
trated, 126 

Looms with pick counters, 
177 



Loss of time between opera- 
tions, 265 

Low wages cost more than 
high wages, 48; discour- 
age efficient man, 66 

Loyalty result of individual 
records and corresponding 
pay, 78 

Machine condition improved 
by bonus, 109 ; operations 
investigated, 263; record, 
253 

Machine-shop balance and 
schedule, 278; Bethlehem 
Steel Company, 265; in- 
struction cards, 261; op- 
eration, reason for delays, 
275; Taylor methods, 105; 
time cards, 282 

Machine- work analysis, 263; 
miscellaneous, 215; spe- 
cialized, 109 

Machinery, breakdowns in- 
frequent under bonus sys- 
tem, 109; inferior or old- 
fashioned, causes inef- 
ficiency, 34; rearranging, 
95 

Machines arranged systema- 
tically for expert supervi- 
sion, 105 ; automatic screw, 
213; clean, 109; effect of 
task on, 109; for bleach- 
ery, 140; good order neces- 
sary for bonus, 187; idle, 
266; in order before set- 
ting task, 134 

Maintenance of best methods 
of work, 39; of conditions 
under which task was set, 
142; of definite degree of 
efficiency, 39; of proper 
conditions, 142; of up-to- 
date equipment out of 
earnings, 35 

Management based on force 



INDEX 



303 



breaks down, 111; chang- 
ing systems, 249 ; deterior- 
ation of system, 241; essen- 
tials to correct system, 
270; foundation of com- 
plete system, 269; func- 
tion of, 247; good system 
a valuable asset, 9; good 
and poor contrasted, 47; 
cost of acquiring good, 10; 
in accordance with gen- 
eral principles, 27; in 
touch with work's prog- 
ress, 170; inefficient pre- 
vents good work, 34; 
must co-operate with 
workers, 219; must give 
specific orders and see 
them carried out, 269; 
must obey laws, 171 ; must 
supply work and train 
workers, 201; not perma- 
nent which does not train 
men, 168; not workmen 
often causes excessive ex- 
pense, 22; opposition of, 
195; proper, eliminates 
loss, 35; responsible for 
delays and interferences, 
127; for more than giving 
orders, 220; seK-perpetu- 
ating system, 162, 240, 
241, 249; study and co- 
operation increase prod- 
uct, 209; successful, 
beneficial to employers 
and employees, 20; sj^stem 
which assures carrying 
out of instructions, 268; 
task and bonus not entire 
system of, 266; training 
workers, 167 

Manager responsible for man- 
aging, 291; (See also 
Management) 

Managers governed by gen- 



eral principles, 27; hesi- 
tate to adopt slow but 
successful methods, 148; 
learn by experience, 201 

Managers' problems, 19, 20; 
economic utilization of 
labor, 19; given to fore- 
men to solve, 97; hardest 
is proper buying of labor, 
44; increase of efficiency, 
20,60 

Man-record, 270; in Midvale 
Steel Foundry, 281; shows 
effect of training, 254, 
255; shows efficiency of 
each man, 280; usefulness 
not appreciated, 253, 254; 
value not based on meth- 
od of payment, 280 

Man-study requires aoihty, 
232 

Manufacture, divisions and 
subdivisions, 95 

Manufacturers can train their 
own workmen, 167 

Manufacturing cost reduced, 
169 

Mastery of any subject im- 
proves personal appear- 
ance, 223 _ 

Materials, scientffic investi- 
gation gives knowledge 
of, 19; used by engineer, 
19 

Mechanic, expert, should 
train men, 83 

Mechanics not interested in 
better methods, 237, 238 

Memory aided by written 
order of work, 128, 129 

Metal Trades Association, 
National, 26 

Methods, conservatism nec- 
essary in changing, 202; 
of evolution in scientific 
management, 8; of pay- 



304 



INDEX 



ing for work, 61; success- 
ful on small scale fail on 
large, 22; study of condi- 
tions should precede adop- 
tion of, 86; universally ap- 
plicable, 27; when familiar, 
adhered to though ineffi- 
cient, 24 

Midvale Steel Company free 
from labor troubles, 114; 
Taylor methods origina- 
ted in, 104; foundry man- 
record, 281 

Mismanagement usual cause 
of strikes, 26 

Mistakes at a minimum, 47 

Misunderstanding causes ob- 
jections, 124 

Monday failures cured, 186 

Money well invested in es- 
tabhshing scientific man- 
agement, 117 

Moral effect of bonus plan, 
108; tone of shop lowered 
by resort to force, 67; 
training, 170 

National Metal Trades As- 
sociation, 26 

Natural method of studying 
complex operation, 41 

Non-metal working trades 
can be improved, 141 

Obedience to orders first es- 
sential to success, 155; 
hard to learn, 156 

Obeying orders, 269 

Object in view makes work 
less tiring, 122 

Observation of details aids 
task determination, 29 

Obstacles always encountered, 
195; disclosed by co-oper- 
ation of workmen, 170; to 
introduction of task and 
bonus, 163 

OHgarchy developed, 230 



One-man control impossible, 

22 

Operation of plants im- 
paired by lack of co- 
operation, 20 

Operations, complex made up 
of simple, 257; method of 
studying, 31 

Opposition to standardiza- 
tion from incompetent 
managers, 163; to work 
for employer's benefit 
only, 110 

Order of operations in ma- 
chine shop, 262 

Order of work in winding 
bobbins, 184; planned, as- 
sists foreman, 129; in- 
creases efficiency, 126 

Output, Carnegie recognized 
value of increasing, 216, 
242; explanation of small 
interest in improving, 232; 
doubled, 210; increased, 
213; by complete instruc- 
tions, 25; by daily bal- 
ance, 280; by exact knowl- 
edge of what is being done, 
288; by instruction cards, 
260; by inteUigent direc- 
tions, 23 ; by proper plan- 
ning and implements, 142; 
by proper ventilation and 
temperature, 135; by sci- 
entific investigation, 30; 
by skilful planning, 25; 
by task and bonus, 169, 
205; by Taylor system, 
149; by two hundred per 
cent, 209; hmited by de- 
layed work, 278; by pen- 
aUzing increased efficien- 
cy, 80; most common ob- 
stacle. 275; not increased 
in proportion to increased 
pay under trusts, 229 



INDEX 



305 



Overhead expense defined, 
242 

Passes for workmen, 285 

Patent laws evaded by patent 
lawyers, 53 

Pay (See Wages). 

Paying for work, two meth- 
ods, 61 

Payment of bonus, preferred 
way, 255; under task and 
bonus, 165 

Penalizing workman for in- 
creased efficiency limits 
output, 80 

Penalty for skill, 80 

Percentage chart, 207; of er- 
rors reduced by bonus 
system, 108 

Perception quickened by task, 
224 

Permanent efficiency, 193 ; 
failure to secure, 110; in- 
crease of efficiency, 23; 
piece rates, 259; in ma- 
chine shop, 105; progress 
through standardizing, 
160; record of each day's 
work, 275; solution of 
problem must benefit all, 
230; results, 211-213 

Philosophy of labor manage- 
ment, underlying fact of, 
. 77 

Piece rate accompanied by 
instructions, 259 

Piece rates in machine shop, 
105 

Piece work for skilled, 114; 

two classes of 79; system 

should be seK-perpetuat- 

ing, 83; six essentials of, 

_82 

Piling of goods in bleachery, 
140 

Planned order of work aids 
foreman, 128 



Planning ahead necessary for 
individual records, 70; 
better than snap judg- 
ment, 132; day's task, 28; 
of compUcated work nec- 
essary, 25; properly in- 
creases output, 142; with 
inteDigence follows stand- 
ardization, 169 ; work from 
central headquarters, 133 

Plans, carefully made, neces- 
sary in complicated work, 
30; with instructions in- 
crease efficiency, 100 per 
cent, 25 

Plant badly planned or poorly 
equipped inefficient, 34; 
impaired by lack of co- 
operation though well- 
designed, 20 

PoUcy of delegating respon- 
sibility to foremen, 97; 
of future to teach and to 
lead, 112, 148; of past to 
drive, 112; short-sighted, 
34 

Practical examples of scien- 
tific management, 4 ; 

Preface, 7 

Preparation for task-setting, 
134 

Prices and profits, 227 

Principles of efficiency, 27; 
scientific management, 8; 
training convincing, 148 

Problem of manager, 19, 20; 
is increase of efficiency, 
60; labor-buying is hard- 
est, 44; of securing satis- 
factory help solved, 167; 
of setting task and fixing 
reward, 123; of studying 
work simplified, 87 

Product better and cheaper 
where tasks are set, 137; 
decrease in cost, 30; im- 



306 



INDEX 



provement in quality, 
30 

Profits and prices, 227; high, 
230; increase with volume 
of business, 231; per unit 
of output increased, 231; 
stable basis for, 246 

Progress of production, 286; 
slow in estabhshing effi- 
ciency, 106 

Prosperity not based on ef- 
ficiency unstable, 247; 
reasons for decline of, 34 

Psychological effect of task, 
143; facts of importance, 
184, 185 

Purchase of labor, inteUi- 
gent, 44, 46 

Quality of product improved, 
30; of work better under 
task and bonus, 203; im- 
proved in few weeks, 211; 
and quantity of work, 153 

Quickness essential to good 
work, 153 

Rates based on busy fore- 
man's estimate are 
guesses, 80 

Ratio of mechanical workers 
and supervisors changed, 
138; of possible to actual 
accomplishment, 25 

Record, daily, in balance 
sheet, 279; of each day's 
work, 275; of individuals 
unusual, 58; of materials 
used saves money, 247; of 
work on order, 286; of 
what has been done, poor 
indication of what capable 
men can do, 79 

Reduction of labor in bleach- 
ing, 140; of manufactur- 
ing cost, 169 

Reforms, ideal conditions for 
instituting, 40 



Regulation of day rate, 65, 
66, 67 

Rehabihty grows under bo- 
nus system, 152 

Rehance upon past progress 
breeds trouble, 51 

Reorganization of bleachery, 
212; dye works, 212; 
packing-box factory, 212; 
sheet and piUow-case fac- 
tory, 199, 210 

Respeeding machines, 105 

Responsibility for doing task, 
136; of management 
shirked by most mana- 
gers, 97 

Results, 207; chapter on, in- 
spired by inquiry ad- 
dressed to author, 4; of 
bonus system, 108, 109; 
of investigation apphed, 
29, 42; of task and bonus, 
152; of training far-reach- 
ing, 175; ratio between 
actual and possible, 25; 
valueless if not apphed, 
151; worth striving for, 
30 

Revolution justified only 
when evolution is impos- 
sible, 7 

Reward beyond reach fails to 
effect workman, 136; for 
following instructions, 258 

Rewarding efficient man, 104; 
Labor, A Bonus System 
of, 148; teacher and work- 
man, 117 

"Routing Diagram" by 
Charles Day, 262 ^' 

Routing must be right before 
tasks are set, 131 

Routing of work, 126, 262; 
supremely important, 262 

Rules useless if principles are 
not understood, 8 



INDEX 



307 



Savings effected by scientific 
management, 246 

Schedule and balance sheet 
combined, 272; value of, 
287; complete in balance 
sheet, 279; (detail) equiv- 
alent, 265; system, 289; 
on paper only, 130 

Schedules as tasks, 125; 
manager must know that 
they are followed, 130 

Scheduling, 269; each part 
important, 126; miscel- 
laneous work, 126, 16^; 
miscellaneous work with- 
out, 143; standard work, 
169; work, 126; intelli- 
gently comes after stand- 
ardizing, 169 

Schenectady Locomotive 
Works, 274 

Schools, industrial, should 
equip graduates with hab- 
its of industry, 153. 

Schwab, Charles M., be- 
Ueved in drive methods, 
113 

Science applied to industry, 
235; stationary until oper- 
ations were investigated, 
41 

Scientific investigation, 21 ; 
alone solves problems re- 
liably, 258; gives knowl- 
edge which eliminates 
chance, 35 ; has three divi- 
sions, 28; indicates im- 
provements, 150; of de- 
tails reveals possible econ- 
omies and improvements, 
23, 24; of machine opera- 
tions, 263; of methods by 
steel industry, 246; of 
operations, 257; of pro- 
cesses not scientifically 
planned reveals incon- 



sistencies, 150; of weav- 
ing operations, 176; only 
method of determining 
laws, 27 

Scientific laboratory for 
studying materials and 
processes, 24 

Scientific management, aim 
of, 124; results in profits 
appear slowly, 248 

Scientific method applied to 
industrial problems, 30 

Selfishness, intelligent, shares 
benefits. 111; as prompt- 
ing force is unintelligent, 
111 

Self-government, 20, 73 ; -per- 
petuating system of man- 
agement, 162, 240, 241, 
249; -preservation motive 
for joining union, 59 

Selling price fixed by agree- 
ment, not value, 234 ; 
increase enlarges profits, 
231; raises cost of living, 
231 

Selhng time more common 
than selling labor, 44 

Sheet and pillow-case fac- 
tory, 199, 200 

Shoveling, best method de- 
termined by long series 
tests, 38, 39; done un- 
economically, 37; ele- 
ments composing each 
operation, 38-41 ; requires 
study before task is set, 
37; standard of efficiency 
must be maintained to se- 
cure increase in wages, 39 ; 
things to be determined, 
37,38 

Skill not an excuse for slow 
work, 154 

Skilled workmen developed, 
167 



308 



INDEX 



Slide rule adapted to planers, 
drill pressers and slotters, 
262; for cutting metals, 
262; at Bethlehem Steel 
Co., 106, 108 

Societies to which only bonus 
earners are ehgible, 166 

Specialized machine shows 
good results, 109 

Specifications for purchase of 
labor, 46 

Specifjdng mode of operation, 
158 

Speed boss gets bonus, 107 

Standard maintained by club, 
162; svstem of teaching 
children, 121, 122; time 
for task, 158; work, 161 

Standardization, 161; helps 
to, 164 

Standardized appliances and 
methods, 160 

Standardizing expert knowl- 
edge, 169 

Standards maintained by task 
and bonus, 164; of work, 
253; welcomed by cap- 
able men, 164 

State, should it bear expense 
of training workmen, 98 

Steel, high-speed, changed 
ratio of mechanical work- 
ers to supervisors, 138; 
industry, 246 

Stimulus to unskilled, 165 

Stop-watch for time-study, 
28, 29, 95, 133; ineffici- 
ently used rouses con- 
tempt, 160; instructor 
asked for by worker, 155; 
used by bright clerk, 159, 
160 

Store-keeping system, 270 

Strike, Lawrence, 199 ; not all 
bad — may cause progress, 
55, 56; result of uniform 



class wage, 78; usually 
produced by mismanage- 
ment, 26 

Study in advance of condi- 
tions under which work 
is to be done, 86; of prin- 
ciples of training con- 
vincing, 148 

Superintendent (See Manage- 
ment); lax, discovered by 
investigator of lost bo- 
nuses, 170 

Supervisor of machine work 
by experts, 105 

System of management, if 
good, produces loyal men, 
86; at fault for incon- 
sistent pajToU disburse- 
ments, 77 ; defined, 1 1 1 ; on 
paper only, 130 

Systematic arrangement of 
machines, 105; increase of 
efficiency essential to suc- 
cess, 60; manager adds 
permanently to efficiency 
of plant, 86; training 
makes for general effici- 
ency, 147; work necessary 
for increased efficiency, 
84 

Tariff, 247 

Task and Bonus System, ad- 
ditional bonus if all ob- 
tain bonus, 115; affords 
justice to employee, 254; 
allows no dreaming, 109; 
appliances in order before 
setting task, 134; applica- 
tions for, 213; assigning 
tasks, 169; at Bethlehem 
Steel Works, 70, 104-111, 
112-115, 253; automatic, 
167; average workman 
does only two-thirds task 
at first, 43 ; bonus changes 
frictional lag into acceler- 



INDEX 



309 



Task and Bonus (continued) 
ation, 170; is 20 to 50 per 
cent of day rate, 135; on 
written statement of in- 
spector, 169, 170; to fore- 
man increased if all men 
make bonus, 114; to gang 
or speed boss, 107; to men 
doing set task, 107; to 
workers controls senti- 
ment, 166; complaints 
analyzed, 210; conditions 
must first be right, 198, 
203; co-operative, 203; 
cures Monday failures, 
186; cures Saturday in- 
efficiency,- 190; cures wan- 
derlust, 183; defined, 165; 
delay in starting not due 
to workmen, 197; de- 
scribed, 254; determining 
method and time, 257; 
develops spirit of co-op- 
eration, 143 ; differs funda- 
mentally from ordinary 
piece work, 261; discrep- 
ancy between task and 
performance, 217; easy 
tasks not undesirable, 218; 
elements and influences 
discussed, 121; eliminates 
driving, 109; errors often- 
er in office than shop, 162; 
extra time as percentage 
of time allowed, 114; fac- 
tory task, 143; foreman 
and workers have mutual 
interest, 143; foreman has 
incentive to teach work- 
men, 114; foreman is 
friend, not driver, of men, 
115; important to begin 
slowly, 198; imposes tasks 
on management, 143; im- 
proves habits of work, 
203; improves machine 



condition, 109; improves 
quahty of work, 203, 211; 
improves wages, 212, 213; 
improves weaving, 191; 
in bleachery, 192; in 
teaching children, 121, 
122; in worsted mill, 194, 
195; incites unskilled to 
efficiency, 151; increases 
output, 203; introduction 
of, 168; loss of bonus al- 
ways investigated, 137; 
loss of bonus educates to 
performance of duty, 163; 
makes accurate predic- 
tions possible, 203 ; makes 
better citizens, 203; makes 
daily output a known 
quantity, 188 ; makes men 
reliable, 152; mastery of 
task improves health and 
appearance, 223; means of 
utihzing, 268; method of 
introducing, 168; natural 
method, 123; not entire 
system of management, 
266; of education with 
prizes, 256 ; permanent, 
241; psychological effect, 
143; ratio between present 
and past accomphshment, 
207; reduces percentage of 
errors, 108; reduces wage 
cost, 207; results in will- 
ing work up to capacity, 
108; results similar in 
various industries, 215; 
rouses men's interests, 
110; Saturday failure, 188, 
189; severity of work reg- 
ulates bonus, 135; shop 
task, 14; summary of, 143; 
stimulates workman to 
maintain standards and 
help progress, 160; task 
exceeded, 218; for one 



310 



INDEX 



Task and Bonus (continued) 
day, 43; gives mental ex- 
hilaration, 224; idea illus- 
trated — locomotives, 126; 
must not be changed un- 
less method is changed, 
92; not increased when 
men become skilled, 92, 
93; set after scientific in- 
vestigation, 43, 150; set 
by teacher, 122; set prop- 
erly and rewarded properly 
is a pleasure, 134; -setters 
from ranks of task doers, 
159; -setting 134, 137, 
158, 177; too severe of no 
advantage, 136; useful in 
applying results of inves- 
tigation, 151; work not 
necessarily severe work, 
135; workers maintain 
habits of industry when 
on day work, 154; teaches 
and trains simultaneously, 
154; teaching best meth- 
ods in shortest time, 117; 
temperature comfortable 
before task is set, 134; 
three elements, 117; time 
percentage better than 
fixed bonus, 114; turns 
guesses into promises, 203 ; 
ventilation adequate be- 
fore setting task, 134; 
what is proper bonus? 135; 
workers adopt badge, 221; 
workers do not strike, 
199 

Taylor, F. W., at Bethlehem 
Steel Works, 104; deter- 
mined laws of cutting 
metal, 261; devised differ- 
ential piece rate, 107; 
methods originated at 
Midvale Steel Co., 104, 
105; object, 105; system 



increased output and re- 
duced cost, 149 

Teacher's qualifications, 222 

Teachers of workmen foimd 
among workmen, 83 

Teaching children, standard 
method, 121, 122 

Temperament, influence of, 
193 

Time card for bleachery, 282; 
machine shop, 282 

Time keeping, 282 

Time and production card 
system, 283; record sys- 
tem in cotton mill, 175 

Time, determination of min- 
imum, 96 ; ' for accom- 
phshing work determined, 
87; for changing jobs im- 
portant, 137; for com- 
plex operation, 257; -keep- 
ing system, 270; losses be- 
tween operations, 265; 
must be allowed only as 
stated on card, 255; plus 
bonus equals piece-rate, 
114; rate plus percentage 
better than fixed bonus, 
114; schedules, 126; study, 
117; study important in 
considering work, 183; 
-studj^ man, 87, 159 

Timing by clerk with stop- 
watch detrimental, 133 

Tool-steel study, 106 

Tools, location of, 261 ; result 
of proper equipment, 142; 
specified for each machine 
operation, 262 

Trained men for initial in- 
vestigation, 29; workers 
yield good supply of in- 
structors or task-setters, 
88; workmen make inves- 
tigators, 162 

Training based on results of 



INDEX 



311 



scientific investigation, 
239; incomplete that fails 
to teach industry, 147; in 
proper habits of work, 
152; takes time, 90; work- 
ers a function of manage- 
ment, 167 

Training workmen, 111, 147; 
abihty required, 222; ben- 
efits foreman financially, 
114; duty of, 136; elimin- 
ates hostihty to improve- 
ment, 238; has far-reach- 
ing results, 175; in cotton 
mill, 175; in habits of 
work, 175; individually 
and collectively for suc- 
cess, 7; necessary before 
task can be performed, 
43; pays, 98, 99; solves in- 
dustrial problem, 220; 
Papadimitri, 178, 179, 
184; Samtak, 177-182; 
who should bear expense? 
98 

Trusts, forming of, 227; get 
what they can by any 
means, 52 j 

Uniform bleaching, 140, 141; 
day rate decreases eflSci- 
ency, 67; wages cause 
strikes, 78; force poor 
workmen and good into 
same class, 78 

Unions, Labor (See Labor 
Unions) 

Unjust demands of labor 
unions, 26 

Unplanned work increases 
wage cost, 25; unjust and 
discouraging to workmen, 
26 

Unskilled succeed in task with 
bonus incentive, 151 ; class 
filled by men impatient of 
restraint, 156 



Utilization of human labor, 
24, 33 ; knowledge through 
task and bonus, 164; ma- 
terials and forces, 19; 
present knowledge, 
268 

Wages and management in- 
separable subjects, 48; 
based on time rather than 
output, 44; cost less un- 
der task and bonus, 216; 
cost more when low than 
when high, 48; equitable, 
secure confidence and co- 
operation, 110; extra if 
task is done in set time 
and way, 82, 91, 92; for 
efficiency will increase ef- 
ficiency, 70, 97; for suc- 
cessful cost reduction, 
233; for task, 158; gauged 
by pay poor worker ac- 
cepts, 60; high, demand 
efl^cient work, 34, 40, 47; 
high enough to be worth 
striving for, 48; horizon- 
tal increase an expedient, 
not a cure, 234; improved, 
212, 213; increased by in- 
vestigation and analysis 
of details, 23; Hberal to 
efficient workmen, 82,110; 
liberal to those supplying 
materials to bonus win- 
ners, 82; must encourage 
habits of industry, 181; 
of workmen, 51-61, 91, 
93, 97; regardless of ef- 
ficiency reduce eflaciency, 
97; to induce men to do 
full task, 28; too high de- 
moralize poor workman, 
60; too low discourage 
efficient man, 66 

Weaver, efficient, wants warp 
and fiUing ready, 71; gets 



312 



INDEX 



bonus for each of twelve 
looms, 197 

Weaving improved by task 
and bonus, 191; study of 
operations, 176 

Work, in factory, clerical 
least efficient, 2l9; rou- 
tine and expert, 289; 
should go through shop in 
order wanted, 132; sim- 
plified by classifying, 132 

Workman indifferent to re- 

._ ward beyond reach, 136; 
ordinarily does only two- 
thirds task at first, 43; 
pays his share for waste- 
ful operation, 47; unin- 
structed does not work 
economically, 258; when 
trained is like private 
soldier, 155 

Workmen after performing 
task may suggest another 
method, 159; benefited by 
maintaining standards, 
166; character of, 56, 57; 



convinced of benefits of 
task setting, 134; con- 
vinced of good faith of 
management wiU be loy- 
al, 94; do better individ- 
ually than in gangs, 72; 
enthusiastic under proper 
scientific training, 8; fear 
reduction of price when 
task can be done easily, 
43, 44; interested in bonus 
system, 110; left to them- 
selves not economical, 41; 
hberal to each other, 56; 
of better class attracted, 
30; proud of efficiency, 
117; ready to help disclose 
and remove obstacles, 170; 
stand by good system, 86; 
trained to efficiency object 
to inefficient system, 71; 
who should bear expense 
of training? 8 

Worsted mill, bonus work, 
194 195 

Zeiss C' ti-al Works, 262 



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